Gareth Thomas: I welcome the European Community's pledge of more than €460 million to the Global Fund to Fight AIDS, Tuberculosis and Malaria, which, together with the contributions of member states, makes the European Union the largest donor to the fund, 30 per cent. of which goes to malaria. The Commission has also allocated more than €350 million for research on vaccines, strengthened prevention methods and better treatment. Given that between 1 million and 3 million people die of malaria each year, however, clearly, the international community, including the European Union, need to do more. That is why we will take forward this issue next year, particularly during our presidency.

David Chidgey: I am grateful for the Minister's reply so far. He may recall, however, from a previous occasion in the House, that the hon. Member for Castle Point (Bob Spink) and I have visited the Francophone parts of west Africa where malaria is rife; the refugee camps in particular. It was pointed out to us that there was at least a 90 per cent. chance of refugees catching malaria within one year. The essence is avoiding the complacency that is sweeping into this area. A focus on aid is necessary, and the United Nations High Commissioner for Refugees in particular is making a plea now for this Government to work more closely with their counterparts in Liberia, from where the refugee crisis emanates, to help to eradicate these health problems. Will the Minister take that message back to his colleagues and do something about it?

Gareth Thomas: There is absolutely no complacency in my Department or across Government about the threat that malaria poses. That is one of the reasons why we want to step up the work of the European Community and ourselves next year. I am delighted to tell the hon. Gentleman and the House that in Mozambique, for example, at the beginning of next year, an £8.5 million programme will start to increase access to bed nets. We need to do more, including getting better progress on a malaria vaccine, which is some 10 years away. We are working with initiatives such as Roll Back Malaria to step up access to bed nets and artemisinin-based combination therapies and to find a malaria vaccine.

Gareth Thomas: We must continue to champion reform, but the European Union, and member states, are already making a difference, particularly through the contributions to the global fund. That has levered in substantial extra money from the United States and other donors for the fight against AIDS, tuberculosis and malaria. The humanitarian and development assistance that the European Community is helping to fund in countries as diverse as Haiti, Kosovo and Sudan is, as I said, making a genuine, important difference to the lives of some of the poorest and most vulnerable in the world.

Gareth Thomas: Repatriation of EC aid would be a complete disaster. It would lead undoubtedly to lower levels of development assistance worldwide. Given that we are currently off track to meet the millennium development goals, that is probably just about the worst thing we could do.
	We need to make more progress in tackling fraud and, as I have said, the EU is taking steps to strengthen its financial systems with our support. The vast bulk of EU aid gets to where it is needed. Given that the Conservative party was responsible for the worst misuse of British development assistance, the Pergau dam affair, I do not think that the hon. Gentleman and his party are in any position to dish out lectures on development.

Peter Pike: What proposals his Department has to ensure heavily indebted poor countries—HIPC—have a robust and sustainable exit strategy from debt after completion of the HIPC programme.

Hilary Benn: The HIPC initiative has reduced the debts of 27 of the world's poorest countries by an average of two thirds, but many are now facing worsening debt ratios once again.That is why we intend to go further, and pay the UK's share of the remaining debt service owed to the concessional lending arms of the World bank and the African Development bank by all countries reaching completion point under HIPC and other low-income countries that can use those resources effectively to reduce poverty. We are encouraging other donors to follow our lead.

Hilary Benn: I am grateful to my hon. Friend for his remarks. The first thing that we can do is to point to the benefit of the $70 billion-worth of debt relief that the HIPC scheme has delivered so far. Another very sound argument is that two thirds of the money saved—money that such countries no longer have to spend on servicing debt—has gone into increased health and education spending. Thirdly, we can point out that unless developing countries get more resources, they will be unable to progress towards the millennium development goals of reducing poverty and getting more children into schools. The best thing that we can do, however, is to lead by example, which is why we will be making these payments from 1 January. I hope that other countries will follow our lead, so that developing countries can be given greater help on a more predictable basis, in order that they can turn their attention to helping their people and improving their lives.

Anthony D Wright: I thank my right hon. Friend for that reply and I congratulate the Government on the investment that they are putting into new technology. They are helping scientists to take the technology forward and remove vaccinations from the cold chain. According to the World Health Organisation, under current budgets, that will mean 10 million more vaccinations being made available in the world. Can my right hon. Friend give an assurance that the relevant budget will not be cut and that funds will be diverted to ensure that 10 million more vaccinations will be made available across the continents of the world?

Hilary Benn: I am happy to give my hon. Friend the assurance that if we can save expenditure on vaccines that is currently wasted because of failures within the refrigeration chain, those resources could be invested to provide more vaccinations. He refers to the research, which DFID helped to fund, that was undertaken by Cambridge Biostability Ltd. It helped to develop a way of storing vaccines—it will now go to trials—that does not involve refrigeration, representing potentially an enormous step forward for vaccination.
	Secondly, we are working with GAVI through the international finance facility model, with the aim of creating a fund of $4 billion, which would enable much more vaccination to take place. We are now very close to eradicating polio, for example, with 2 billion children immunised across the world. An estimated 5 million children can walk normally today because of the progress made in vaccination against polio. That demonstrates the benefits of the world doing more to protect the lives of our children.

Michael Fabricant: What research does the Department undertake on the efficacy of vaccines in all instances when there may be alternative methods of protecting people from infection? In particular, I am thinking of malaria. The Secretary of State knows that his Department funds an immunisation programme, but in certain areas where transmissibility is not high—in South Africa, northern Kenya and Angola—it has been suggested that the money could be better spent on the provision of nets and other forms of prophylaxis. What research has been undertaken on that and will the Secretary of State consider the possibility of transferring money from the vaccination programme to that alternative instead if it is clear that it would provide a more effective way of protecting people's lives?

Hilary Benn: The UK will provide over £1 billion in aid to Africa next year. Our priorities are to help build the conditions for development by promoting peace, democracy and economic growth, to help Africa progress towards the millennium development goals with HIV/AIDS, reducing child and maternal mortality and tackling hunger as priorities, and to help build Africa's capacity to develop itself. We will provide substantial assistance to the African Union and to support the recommendations of the Africa Commission.

Hilary Benn: I do not agree that we have reached a different conclusion, because we are working on all three of those matters. The hon. Gentleman will be only too well aware that, in 1997, the UK was spending £38 million a year through its development programme in the fight against HIV/AIDS and to promote reproductive and sexual health. Next year, and in the two years after that, Britain will put £500 million a year into the fight against HIV/AIDS and to promote reproductive and sexual health. By any measure, that is a very substantial increase and it is due to the fact that we have a rising aid programme. We are doing all the things that the Copenhagen consensus outlined in its document, but we are also investing—unapologetically—in improving health and education. If we do not improve the health services, it will be very difficult to get treatment to people suffering from HIV/AIDS.

Alan Duncan: Let us assume for a moment that we accept the Secretary of State's priorities. If he accepts the need for prioritisation such as he has described when determining how our aid budget is allocated, why is he happy to give a quarter of our total aid budget to the EU, which spends only half of its funds on tackling poverty in the poorest countries? If the Government want to apply their poverty-reduction criteria effectively, how can they justify the diversion of a quarter of the aid that they give through a channel that applies completely different criteria?

Anthony D Wright: Unemployment in my constituency has fallen by 40 per cent. since 1997. However, we still have twice the national and regional average unemployment in my constituency. One of the projects that may regenerate Great Yarmouth is the new outer harbour project, which has been in being for the past five or six years. Will my right hon. Friend ask the Department of Transport when a decision will be made on that project and encourage it to provide an affirmative answer in terms of the public funding for that project?

Tony Blair: First, in respect of homelessness, many of the families that are characterised as homeless do actually have accommodation, but it is temporary accommodation. The numbers of people sleeping rough on the streets have been cut dramatically; by two thirds. As opposed to the situation in 1997, more than 80 per cent. of homeless households in temporary accommodation are in good quality, self-contained homes, and the vast majority are not in bed-and-breakfast accommodation.
	Let me make one further point to the right hon. and learned Gentleman. We are going to increase the housing budget and the budget for the homeless over the next few years. Under the proposals of the shadow Chancellor, the right hon. and learned Gentleman is set to freeze the housing budget—perhaps he will confirm that—and that would cut £400 million from the housing budget.

Tony Blair: Let me come back to the promise about housing. It was to cut rough sleepers and we have done that very substantially indeed—[Interruption.] No, I am sorry. I am not letting the right hon. and learned Gentleman get away with this. In respect of temporary accommodation, the change today is that the vast majority of those 100,000 are in good-quality, self-contained homes. How does he square his supposed commitment to the homeless with cutting their budget? He did not answer that question. Perhaps he will now.
	In respect of truancy, it is correct; we have accepted that we have not met the truancy target. However, there are in fact 43,000 extra pupils attending school today, which is important. Double the number of pupils are in the pupil referral units. I accept that there is much more to do on truancy, but overall in respect of education we have improved investment, all school results are up and according to the latest report our primary schools have succeeded faster than any other country in Europe. The right hon. and learned Gentleman is committed, under his voucher scheme, to take £1 billion out of the school system. Perhaps he will confirm that that is the case.

Michael Howard: He did not even mention detection rates. Three questions asked; none of them answered. Let us try another one.
	"When Labour came to office we had one of the strongest pension provisions in Europe and now probably we have some of the weakest."
	Those are the words of the Prime Minister's first Pensions Minister. How does he explain that failure?

Michael Howard: The Prime Minister has not explained any of those failures. Let me see if I can help. I know that he is going abroad over the holidays and I have some holiday reading for him; the new biography of the Home Secretary, hot off the press today. The front cover says that it paints a portrait of an enigmatic man that will surprise even those who think they know him. I particularly recommend to the Prime Minister the Home Secretary's helpful assessment of the Prime Minister and his Cabinet colleagues. Will the Prime Minister promise to read the book carefully, so that when he comes back to the House in the new year he can give a full explanation of his Government's total failure to deliver? [Interruption.]

John McFall: Despite the welcome engagement between the Lord Chancellor and His Grace Archbishop Peter Smith on the issue of euthanasia by omission, including food and fluid, there is still a concern on the part of a number of Members on this issue. Can the Government give us an assurance that they will embrace the spirit of new clauses 1 and 2, for which I did not vote? To ensure that we bring clarity and sense to such a complex and sensitive issue, will the Prime Minister meet a delegation of concerned Members so that we get on the statute book a very welcome and appropriate Mental Capacity Bill?

Tony Blair: I should thank my right hon. Friend for the very reasonable way that he puts his point and say that I would of course be happy to meet him and his colleagues. Importantly, the Making Decisions Alliance said yesterday—it is an alliance representing some 40 charities whose words should at least carry some weight for us—
	"the Bill could finally give those we work with real control over their day to day lives . . . All of this could be lost if the Bill is sabotaged by misplaced fears about euthanasia".
	There is obviously an issue of concern and this is what the Catholic Archbishop raised with me yesterday. We will do everything we can to meet that concern and make sure that we avoid any doubt about the purport of the Bill, but let us be quite clear. What is right is to make it clear that someone's life cannot be ended intentionally. That must be right. I hope, though, that the whole House understands that what would be wrong—this is what we were advised that the amendment that we voted against yesterday would do—would be to end up in a situation where the Tony Bland judgment was overturned. That would be very damaging for relatives, for individuals and for the medical profession. So we need to make sure that we take account of the very sensible points that have been made by my right hon. Friend, but that we do not end up giving ourselves, and indeed the medical profession, a serious public policy problem. That would be wrong and I could not endorse it.

Charles Kennedy: On the latter point, is that not one of the problems particularly associated with compulsory identity cards for people living in outlying areas—for example, pensioners or disabled people—who will face long and expensive journeys into cities to go to the secure centres where they will have their iris scans or their fingerprints taken to get the ID card. That leads many of us to ask this question: have the Government actually thought through the practical implications for people of the scheme that they propose?

Neil Turner: A number of my constituents have reported to me the theft of their telephone lines, which comes to light only when they get their bills and people threaten to cut them off. The numbers are intercepted via the internet and then used to make international premium-rate calls. Will my right hon. Friend use the UK presidency of the EU and the G8 to take international action to stop that theft, which causes great distress to hard-working families and could fund international terrorism and organised crime?

Tony Blair: I understand the importance of this issue, and I am aware that it is a big issue for many hon. Members. I can tell my hon. Friend that the Government have asked Ofcom to review the regulation of premium-rate services to tighten things up in response to these complaints. That review was published on 9 December, and it makes new recommendations that, I hope, will help to deal with the problem. On the other hand, the legitimate use of premium-rate numbers, for everything from weather forecasts to TV shows, is a £1 billion-a-year industry, so we have to ensure that that regulation strikes a sensible balance.

Sue Doughty: This year, four children and their families will spend Christmas in Christopher's hospice in my constituency. I am sure that the Prime Minister will want to join me in paying tribute to the children's hospice movement and its work with life-limited children and their families, but the hospices receive no Government funding. Money from primary care trusts just does not get there. Will the Prime Minister consider options to ring-fence health service funding to guarantee children's hospices an equivalent level of funding as that received by adult hospices?

Tony Blair: I certainly would pay tribute to the children's hospice movement, which does an extraordinary job up and down the country in many different constituencies, and I simply say to the hon. Lady that I do not think that I can promise to do what she asks. We are obviously increasing the investment in the health service very considerably. We do look at what more we can do for the hospice movement, but I do not think that ring-fencing would be the right thing to do.

Louise Ellman: Liverpool has been transformed under a Labour Government, with unemployment halved and the city designated European capital of culture, yet the Rowntree Foundation has shown that there are still far too many children in Liverpool growing up in poverty and in households without work. What can the Government do differently to change this unacceptable situation?

Tony Blair: What my hon. Friend says is right. Liverpool is a city in the process of transformation. I know that its designation as a capital of culture has generated enormous enthusiasm in the city. Unemployment rates have come down considerably and living standards have risen, but my hon. Friend is right. There is still a great deal more to do. That is why it is important that we keep programmes such as the new deal for the unemployed and Sure Start, and the record investment going into our health, education and services, on the basis of people's need, not their ability to pay. Those are all policies that we as a Government will continue to implement. In the light of the huge spending commitments and then spending cuts that have been proposed by the Opposition, the people of Liverpool will have a very clear choice at the next election.

John Baron: The Prime Minister will recall that I have raised with him on a number of occasions the fact that our planning laws clearly fail to deal with determined Travellers who buy green belt land and then illegally and speedily develop it. As a result, many law-abiding residents living close to those illegal encampments are being discriminated against. Following our meeting, which he kindly agreed to, will the Prime Minister now respond to my letter to him dated 20 October, for which I got an acknowledgement but no substantive response? The letter set out further details about my private Member's Bill on the issue, which had good cross-party support but was blocked by the Government without explanation.

Kevin Brennan: Many parents will welcome the fact that in the new year the child trust fund will be payable to babies. It is welcome news over Christmas, but could the Prime Minister make it even better news, since the Chancellor is sitting next to him, by asking the Chancellor to make sure that any backdated payments have interest paid on them, and also by preventing money being taken from people in the future by any party that seeks to abolish the trust fund?

Lembit �pik: I seek your forbearance, Mr. Speaker, to enable me to apologise to the Minister of State, Ministry of Defence, for misrepresenting his position in my contribution following his statement on 30 November 2004 regarding the allegation of abuse at Deepcut Army barracks. I accused him on that occasion of referring to the four deaths as suicides. Having studied the official record, I can see that I was wrong to do so. He made no reference to the events at Deepcut in that context. It was in fact the Army that told my constituents, Des and Doreen James, that their daughter Cheryl had committed suicide before the coroner had even reported. The Minister did not do that. As he said to me in his letter:
	Those of us in positions of knowledge and responsibility have an added duty to ensure that we do not further confuse the situation with misinformation.
	I agree with him, and as the campaign for a full independent public inquiry into the four deaths continues, I hope that I will be able to work effectively with him, and I hope that he will accept my apology.

Mr. Speaker: I was not in the Chamber at the time, so it is an allegation as far as I am concerned. I have made a Speaker's statement about the conduct of the civil servants Box. The only communications that should be conducted from that Box are via a Parliamentary Private Secretary to a Minister, one document at a time. I shall write to the Lord Chancellor and have instructed my officials to prepare a letter. I will not allow the mass distribution of documents, and, if the allegation is correct, I will go as far as withdrawing privileges from civil servants who come into that BoxI take the matter very seriously. The hon. Gentleman has put the allegation to me, and I will raise it with the Lord Chancellor.

George Foulkes: On a point of order, Mr. Speaker, you have pointed out that intemperate comments are sometimes made when hon. Members raise points of order. What is the difference between a point of order raised by the Opposition deputy Chief Whip from the Dispatch Box and a point of order raised by him when he purports to be a Back Bencher? Is that not abuse of his paid position?

Mr. Speaker: Those matters are for the usual channels. The neutrality of the Speaker is important at all times, and I will not be drawn into the arguments posed by the hon. Gentleman.

Martin Smyth: On a point of order, yesterday's Northern Ireland news reported on a young man who contracted variant Creutzfeldt-Jakob disease some years ago and who was left by the medical profession as a terminally ill person. However, his parents nursed him and his father fought in the High Court to get him particular new forms of treatment. Yesterday, it was announced that the health workers from the hospice and voluntary sector are withdrawing their help because he is no longer terminally ill. Have you received a request from a Health Minister to make a statement in the House both to encourage that treatment and to urge greater caution in diagnosing people as terminally ill?

Phil Woolas: On a point of order, Mr. Speaker. It may be helpful to the House, in response to the point of order raised at column 1584 by the hon. Member for West Derbyshire (Mr. McLoughlin), to the ruling by Mr. Deputy Speaker, and to your own comments today if I could give the House the assurance that my right hon. Friend the Leader of the House will of course co-operate fully in ensuring that the facts are properly put on record as to what did happen yesterday with the distribution of letters. We do take these commitments very seriously. Our own investigation shows that the proper distribution methods were undertaken, but we will of course wish to present the House and you, Mr. Speaker, with the full facts to satisfy, I hope, hon. Members on both sides of the House.

Jack Straw: Whether it is on this point or notI am not that generous.
	The main business of the Council will be a decision on opening membership negotiations with Turkey. Before I come to that, let me go through some other key issues on the agenda.
	We expect some discussion at the Council of the European Union's budget for 200713. The budget negotiations are still at an early stage, and the Government welcome the work done so far by the Dutch presidency. The European Council will discuss a progress report, and the presidency will seek to agree principles and guidelines for the continuing negotiations. For our part, we want to ensure that the money is spent effectively; that the budget is affordable; and that EU programmes are pursued only where they add value. More generally, we have made it clear that we seek an EU budget limited to 1 per cent. of Europe's gross national income, as opposed to the 1.24 per cent. that is currently proposed by the Commission. France, Germany, Austria, the Netherlands and Sweden share our view, and we have made our common position clear in public.

Jack Straw: I will, but I want to get through a little bit more before I first give way to the hon. Member for Banbury (Tony Baldry).
	There may also be some discussion at the Council of how the EU raises its revenuethe so-called own resources system. All member states have to agree to any changes, especially those that are net contributors, and everyone has a veto. We will oppose any attempt to reopen the discussion on the UK's budget rebate, whichas we continue to make forcibly clearis fully justified.
	The Council will also discuss a number of foreign policy issues, including EU support for the Palestinian elections in January and the situation in Ukraine. It is worth reminding the House that this is common European foreign policy in practice. If the UK decides not to work with other countries, there is no such policyas, for example, there was not in respect of Iraqbecause the policy requires the agreement of every one of the EU's member states. That will remain emphatically the case under the new EU constitutional treaty.
	However, there are clearly many issues on which 25 nations speaking as one have a great deal more influence than we would on our own. On the middle east, the EU's membership of the Quartet, which also includes the United States, Russia and the United Nations, helps us actively to support the peace process. The EU is one of the biggest donors to the Palestinian Authority.
	If anyone wants a good example of a common foreign policy working in practice, it is the united EU response and consistent message about the need for a free and fair electoral process that helped resolve the political crisis in the Ukraine. The Presidents of Poland and Lithuania and EU high representative Javier Solana played an important role in that by helping to facilitate talks between the parties. The second round of the presidential elections will be rerun on our Boxing day and the EU is maintaining pressure for that free and fair rerun of the election. We discussed it in detail at the Foreign Ministers Council on Monday and we will contribute observers to the Organisation for Security and Co-operation in Europe election mission.

Tony Baldry: Twice a year, we have an opportunity for a day of group therapy on Europe but European competence covers many Departments. For example, it involves trade policy, migration policy and development policy. Yet junior Ministers from the other Departments do not even do us the courtesy of attending the debate. [Interruption.] I am referring to the Government. Will the Foreign Secretary give the House an undertaking to relay to other Cabinet Ministers points that are made in today's debate that specifically relate to their Departments? Otherwise, we are simply speaking to the wind and the Chamber becomes a senate of Lilliput.

Jack Straw: There is a general problem, which affects both sides of the House, about attendance in the Chamber. It has more to do with Back-Bench than Front-Bench attendance. In my 25-year experience, Front Benchers in such debates constitute only the Whips and the Ministers who are involved.
	On the second point, I take seriously what the House says about the European Unionand any other issue. We initiated and established arrangements, which meant Parliament's full and active involvement in the Convention and the intergovernmental conference.

Jack Straw: No, I shall make some progress and then I shall take interventions.
	I am pleased that our work on Iran has been endorsed by all sides. Our work with France, Germany and the EU in the past 14 months has secured agreement by Iran to suspend all uranium enrichment-related and reprocessing activities. On Monday, my French and German colleagues, EU high representative Javier Solana and I met Dr Hassan Rouhani, Secretary General of Iran's supreme national security council, in Brussels to begin the process of negotiation on longer-term arrangements with Iran. One of the purposes of the negotiation is to provide objective guarantees that Iran's nuclear programme can be used only for peaceful purposes. That is the reality of EU common foreign policy, not the fantastical accusations that we so often hear from the Opposition. It shows how Britain benefits from the role that we play in the European Union, increasing our influence and impact in the world without in any way detracting from our independence of action. As we can have the best of both worldswe can be independent and autonomous when we want but work with our partners when we wantI cannot for the life of me understand the logic adopted by the Opposition, particularly the right hon. and learned Member for Devizes, who now says that the common foreign and security policy should be abandoned. That would merely weaken Britain's influence in the world without adding to our autonomy in any way. It is even odder, given that the right hon. and learned Gentleman was an arch-proponent of Maastricht in 1992 and made lurid speeches in favour of it. He even said, as the hon. Member for Stone (Mr. Cash) will recall, that he would rather be inside a superstate.

Jack Straw: Indeed. It is complete nonsense to suggest that the touchstone for Europe and whether we support or reject a European foreign and security policy is having access at all times to the diary of the High Representative. What makes the hon. Gentleman's point even more synthetic is the nature of the official policy of Her Majesty's loyal Opposition this time last year. Notwithstanding an EU-wide ban on anybody talking to Hamas, we were asked by the hon. Member for Rutland and Melton (Mr. Duncan), their official spokesman on foreign policy at the time, to do so. Not once has that been repudiated by their Front Bench spokesmen.
	There are many examples of the way in which we work better together on the agenda of the European Council. For example, the Council will discuss progress on the EU action plan on terrorism agreed last March, and it is expected to agree a new EU drugs strategy for the next seven years. Drugs and terrorism are self-evidently threats that cross national borders. We cannot just wait until they arrive at Doverwe have to tackle them by working together with our neighbours. Then there is the issue of economic reform. We have a clear interest in promoting stronger growth and greater flexibility in Europe, our most important market. British companies have benefited greatly from European liberalisation, and will gain further from reform in future. We are winning the arguments. The new President of the European Commission, Jos Manuel Barroso, and his team have already set out a strong commitment to promoting economic reform, including making better regulation a top priority. The Commission has just announced that it is withdrawing 100 pieces of pending legislation, and the EU has agreed the UK's proposal for competitiveness-testing of new regulations.
	The six presidencies initiative on better regulation announced by my right hon. Friend the Chancellor of the Exchequer at the ECOFIN meeting on 7 December gives us a clear strategy for making further progress. We will continue to work closely with British industry and the new Commission team on this agenda in the coming months.

Gisela Stuart: As the Foreign Secretary is talking about removing regulations would he consider the notion that any proposal from the Commission should have a time limit on it? Unless agreement is reached within a set time it should be withdrawn, because other legislatures operate within limits set by, for example, the Queen's Speech or a general election. That would help to prevent proposals from dragging on endlessly.

Jack Straw: I was not aware of that vote and I am grateful, as I am sure the House is, to the hon. Gentleman for giving us that information. I shall come to Turkey later, but I welcome that vote. I have not seen the text of the motion, but I hope that it is an unconditional vote in favour. We hope that Turkey's membership negotiations will be agreed on Friday.
	Now, in the words of the late Ernest Bevin, I will give way to 'im.

John Bercow: Under the terms of acquis communautaire, we do not have independence in trade policy, which underlines the importance of working together effectively within the European Union. Given that rape as a weapon of war, compulsory relocation, forced labour, the use of child soldiers and human mine-sweepers and the bestial destruction of villages are part of the cocktail of barbarity visited on the people of Burma every day, does the right hon. Gentleman agree that it is now incumbent on the EU to step up its act on sanctions against Burma? It should not concentrate action against the pineapple juice sector in that country but instead develop targeted sanctions on oil, gas, telecommunications, timber and gems to hasten the day when the people of Burma have the freedom that we have long enjoyed and that they have been too long denied.

Jack Straw: Indeed. I was delighted to entertain His Excellency the Prime Minister of Estonia when he came here. One of the subjects of conversation at lunch was the fact that we have a Member of Parliament of Estonian extraction who speaks good Queen's English and represents a Welsh constituency. It is refreshing to have the 10 new members in the room, because the further east they are the further west they tend to look.
	EU enlargement has long been an objective of successive British Governments, and rightly so.
	Europe, and with it, Britain, suffered in the last century from the two most destructive wars in human history and, until the mid-1970s, half of Europe's countries were dictatorships of one kind or another. But the fact that peace and democracy have now spread across the continent is, to a significant degree, thanks to the role that the European Union has played.
	Since its foundation, the EU has helped to turn formerly bitter enemies into the closest of partners. It has brought divided communities closer together, as it did with Britain and Ireland when we joined in the 1970s. As Spain, Portugal and Greece threw off one-party rule and began to entrench democratic institutions during the 1970s, the prospect of EU membership acted as a powerful motor for change. In the 1990s, as the countries of eastern Europe, including the Baltic states, emerged from the shadow of communism, the EU again drove a similar process. The goal of EU membership gave those countries a powerful incentive for both political and economic reform, as they opened their economies to trade and implemented EU laws and standards in areas such as environmental protection.
	The European Council this week will be asked to endorse the conclusion of EU membership negotiations with two more countriesRomania and Bulgariawith a joint accession treaty to be signed early next year, putting them on track to join the EU in January 2007. EU leaders will also discuss whether to set a date for opening membership negotiations with Croatiaa goal that the UK supportsalthough we also want Croatia to improve its co-operation with the International Criminal Tribunal for the Former Yugoslavia in The Hague.

George Foulkes: Does my right hon. Friend accept that, until such time as these countries become members of the European Union, co-operation can still be achieved, to a limited degree, through the Council of Europe, which, thankfully, will have a summit meeting next year, that I hope that he will attend? The Council of Europe is considering a convention on human trafficking, which is vital, as such trafficking creates tremendous problems. Recently, I attended a meeting at the Council of Europe and we are concerned that the convention will not be strong enough. Will he examine the recommendations from its Parliamentary Assembly to see whether the convention can be strengthened?

Jack Straw: I am delighted to say to my right hon. Friend that, of course, I will do so.
	The issue of Turkey will dominate proceedings on Thursday and Friday.

Michael Ancram: Derek Scott said:
	the Government never saw the discussions on the constitution as an opportunity to stand back and think clearly about the appropriate political and economic framework to sustain the EU. There was no strategic thinking.
	The right hon. and learned Member for North-East Fife (Sir Menzies Campbell) may say Not again, but I think that Derek Scott, given his experience of Downing street and what went on there, is a man to whom we should listen. If I may quote the Home Secretary's famous phrase, the Foreign Secretary has once again presided over a giant messand today, as he prepares to attend this weekend's Euro summit, he is once again in a mess.
	Let us leave aside the detail of the constitution for the moment. What has happened to it in practice? This time last year, it was so central to the Government's European policy that it could not even be put to a referendum of the British people. Last year, the Prime Minister described it as
	a gross and irresponsible betrayal of the British national interest.
	At about the same time, the Foreign Secretary told us that there was
	no case for a referendum.[Official Report, 11 June 2003; Vol.406, c.724.]
	As we now learn from the New Statesman, that was until the Minister for Europe, apparently, turned to the Foreign Secretary during a debate.
	I turned to Jack and said: 'Jack, we're'
	I cannot repeat the next word; I shall have to say expletive deleted. The Minister went on
	We've got to give a referendum. I don't think we can hold out.
	That was a welcome U-turn, but where is the constitution now? Where is the road show that the hon. Member for Leicester, East (Keith Vaz)who is barracking from the Back Benchespromised us three years ago? I can only assume that it is an invisible road show.
	The ratification Bill is the only piece of Foreign Office legislation in the Queen's Speech. What has happened to it? During a little publicised meeting of the parliamentary Labour party on 29 November, the Foreign Secretary apparently told his colleagues that he hoped they would
	become actively involved in the debate on the European Referendum Bill which would shortly be coming before the House.
	He added, apparently without sarcasm, that
	this would provide a good opportunity to refresh
	to refresh!
	support for the EU amongst the British people.
	Where is this refreshing Bill? There will be no sign of it before Christmas. The Government Chief Whip is briefing that it will not be passed before the next general election. There are suggestions that it will not even be introduced before then. Who is right, the Foreign Secretary or the Chief Whipor is this just another Straw mess?
	The text for which we were told we would have to wait is now with us. The Foreign Secretary said that he wanted a document that he could put in his pocket. This is it. What are the Government frightened of? Could it be the fear that, before the election a full debate, far from being refreshing, would awaken the British people to the extent of the betrayal and sell-out of Britain that the constitution engenders? If the Government had the courage of their convictions, they would introduce that legislation now.

Michael Ancram: I can assure those who think that I made up that quote that it is in the transcript. Perhaps one day the Minister for Europe will provide a translation of it.
	Fathoming the Foreign Secretary's position is not much easier. He exhibits schizophrenia on the question of a referendum. One moment he is aggressively against a referendum and the next he is passionately in favour. That is surely not just because the Minister for Europe, as we heard, swore at him. This is the same Foreign Secretary who blithely assured the House in the autumn of 2003 that EU enlargement would not create undue or unsupportable migration to the UK from the accession countries. He will remember the debate in question.
	We now learn from Stephen Pollard's new biography that, according to the Home Secretary, the Foreign Secretary flew into an hysterical panic over migration when the EU was enlarged. I am very grateful to the Government Chief Whip. He kindly handed back the copy of the biography that my right hon. and learned Friend the Leader of the Opposition tried to give to the Prime Minister as a Christmas present, so that I could better use it, having been unable to get a copy myself. I have had a moment or two to glance at it and it is worth reading the following quote into the record. It says:
	'Jack Straw and the Foreign Office just completely flipped on the position they had held before. Jack went into hysterical mode about what he now saw as the impending consequences of accession. He started making dramatic predictions of what would happencompletely the opposite of what he had wanted about five minutes earlier.' For months, Straw had been 'the man who said everybody was welcome to come and draw benefits', as Blunkett puts it. Come the moment of accession, however, Straw 'suddenly decides he's in a terrible panic and he doesn't want anybody here at all. And so we're going round in circles.'

Michael Ancram: Of course I do, but as I shall discuss later, we should play that role alongside the United States, not in competition with it. That is the lesson that Europe has to learn.
	In contrast with the Government, we have a clear view of Europe and of the EU. We are in Europe, and we are determined that Britain should be a positive and influential member of the EU. We are looking for a more flexible, less bossy Europe, in which the strengths and wishes of individual nations count. We believe that to achieve that, Europe must change. We oppose the constitution in principle because we believe it is a gateway to a country called Europe to which we do not want to go. We also oppose it in detail, because it erodes our essential rights in respect of self-determination. I have been through the list of those erosionsthe trappings of European statehoodmany times, so I need not do so again today.
	I will, however, allude to a new erosion of our rights. The accusation has been made that the constitution will make the already serious problem of EU fraud even worse. Let me quote whistle-blower Marta Andreasen, who certainly knows the workings of the EU institutions backwards. Last week, she pointed out that those institutions needed reform, rather than more powers. She charged that the constitution would create a dangerous system of shared control that is equivalent to no control. She said:
	my experience from the inside allows me to say that we are at great risk if we vote for a Constitution that increases the powers of institutions which have proved up until now to be totally unaccountable and lacking in transparency. If we let go this opportunity to express our dissent there will not be another opportunity again.
	We should listen to her.
	We will therefore campaign to defeat this constitution in the referendum, when it comes. With us in government, it will come by next September, and I believe that the British people will have the good sense to vote no. That will, in turn, open the door to the building of a new Europe that works for its peoples, not its elites. We will reverse the conveyor belt that for too long has transferred powers only one wayfrom national Parliaments to Brussels. It is clear that the EU has powers in respect of matters that would be better dealt with by member states, and we are not alone in thinking this. As Commissioner Margot Wallstrm said,
	in the European Commission we must accept that more power is moved back to the member states.
	The Dutch Foreign Minister Bernard Bot said that
	the EU needs to practise self-restraint. It should look expressly at those parts of common policy for which member states could take responsibility again.
	The Minister for Europe will be delighted to know that included in that list of parts were aspects of the common agricultural policy.

Michael Ancram: The hon. Gentleman knows the rules of intergovernmental conferences. If there is one veto, the treaty dies. That has been made clear on both sides of the House and has been accepted by those responsible in the Convention for producing the constitution.
	The need for a flexible Europe has never been greater. As the Foreign Secretary said, enlargement has not reached its limits and I am delighted that there is cross-party support in this country for negotiations to begin for Turkey's membership. Ukraine, too, is showing a European vocation, but an EU of 30 or more countries would be unworkable under the current tight structure and would be worse still if the constitution came into force.
	The Foreign Secretary chided me for wanting to see Turkey open negotiations while saying at the same time that we should vote against the constitution. May I remind him that the constitution's designer, Giscard d'Estaing, said:
	the European constitution currently submitted for ratification was not conceived to welcome in a national power the size of Turkey.?
	On this occasion, Giscard d'Estaing and I are as one. We believe that if we are to have an enlarged Europe, we need a different constitution.
	We have seen two rather different elections in Romania and Ukraine. I congratulate the new President of Romania and I would like to see Romania in the European Union, but first the Government must show that they have dealt with current concerns about the integrity of the political process and the judicial process, and with corruption elsewhere in Romanian society. We salute the Ukrainian people for their defence of, and enthusiasm for, democracy. We very much hope that the elections on Boxing day are free of fraud. Ukraine will always have a special relationship with Russia, but equally it has a right to look to join the European Union.
	Deregulation is another key feature of the Europe that we want to see. The failure of the Lisbon agenda is a matter for regret. The EU is burdened with far too many regulations and we need systematically to reverse the drivers of regulation.
	The European Union has achieved much that is good. It has effected a lasting reconciliation between countries that were once bitter enemies. It has nurtured young democracies. It has been the lure for countries emerging from dictatorship to uphold the rule of law. It has created wealth by opening up European markets. It has done all those as a partnership of sovereign nation states. That is what we must now build on. The antithesis of that would be to follow those who seek to create a superpower to act as a counterweight or rival to the United Statesand that we must resist. It is a vain vision that would make a dangerous world even more dangerous.
	As we approach the EU summit this weekend, there is a choice of approachto stand up for British interests or to continue to be Europe's poodle. The Government have pursued the latter path for too long. Within Europe, it is time to make our true voice heard again.

Menzies Campbell: I cannot begin without expressing my profound disappointment that the Government have neither published nor introduced to Parliament the Bill designed to facilitate the ratification of the treaty, establishing a single constitutional document for Europe. It has been reported that the Government Chief Whip believes that it would be difficult to put such a Bill on the statute book before the election. If that report is true, it conveys two pieces of information: first, that the likely date of the election is almost certainly 5 May probably the worst kept political secret in Westminsterand, secondly, the lack of enthusiasm on the part of the Government to put such a measure through Parliament.
	I find that particularly disappointing, as I had been looking forward to campaigning with the Foreign Secretary. I could see him, myself and perhaps the right hon. and learned Member for Rushcliffe (Mr. Clarke) going to mass meetings of the British people, strenuously arguing the case for endorsing the constitution. It now appears from what the Minister for Europe has told the people of Durham that I was responsible for persuading the Foreign Secretary of the virtues of the referendum, so I count it as a personal failure that I have not been able to persuade him of the virtues of early legislation on this matter.
	Enlargement will undoubtedly be a significant issue for discussion this weekend. Not much reference has been made to Bulgaria, but I understand that that country has now pretty well closed all her chapters and will, in that sense, be eligible for membership. I hope that that membership proceeds smoothly and expeditiously.
	In the matter of Romania, to which some reference has been made, the right hon. and learned Member for Devizes (Mr. Ancram) was right that considerable doubts remain about corruption, the rule of law and the independence of the judiciary, but we are entitled to derive some encouragement from the election of Mr. Basescu, who was elected expressly on an anti-corruption ticket. As the Foreign Secretary was willing to agree a few moments ago, that is a clear indication of how the prospect of European Union membershipand, indeed, its requirementsmay have considerable influence on electorates, who are aware that without substantial change and their support for suitable political candidates, their aspirations for membership may not be able to be realised.
	It is inevitable that the principal focus will be on Turkey. One national newspaper this week rather portentously said that Turkey's moment has arrived. The admission of Turkey will be a strategic decision of historic importance. The Foreign Secretary himself spoke of Turkey forming a bridge between Islam and the west. There is reason to believe that Turkey's ultimate entry may not be for some years10 years in some estimates. In the meantime, there is an opportunity for inward investment and modernisation to take place. Just as the whole House supports Turkey's accession to the EU in principle, so it will also support the view that Turkey must implement all necessary reforms in full. There is a sense in which Turkey and the Turks must prove themselves, but it is important that they do so according to the same conditions as apply to everyone else, and that the bar is not set higher for Turkey than for any other applicant country.

Menzies Campbell: In general, I agree with the hon. Gentleman on that.
	In addition, I should need a great deal of persuading before I could accept the Commission's proposals for substantial increases in EU funding. There are continuing allegations of corruption, and the auditors have still not signed off the accounts. As a result, this is no time to ask for more money and to do so would display a certain amount of insensitivity in political terms. In that regard, I support the British's Government's position, which is buttressed by France, Germany, Sweden, Holland and, I understand, Austria. The aim is to stabilise current expenditure and to limit the budget to 1 per cent. of gross national income. Given the present rate of current economic growth in the EU, increased spending at this time would be both unwise and even unsustainable.
	I turn now to the CAP. The priority for budget savings must not be the abandonment or destruction of the CAP. People who believe that it can be simply wished away or destroyed have a rather optimistic view of such matters. What is essential is reform. The CAP's failings are self-evident. They include excessive production, unsustainable farming practices, the penalising of both taxpayers and consumers, and an impact on the developing world that we may sometimes forget in our discussions but which matters a great deal when it comes to issues of universal free trade. No doubt that is an issue to which the newly appointed British Commissioner will give his considerable attention.
	Moreover, implementation of the reforms to meet the Lisbon targets has been very slow. Growth in the EU is slow and intermittent, and that is of some concern. Unemployment in France, Germany and Italy is now on the order of 10 per cent. That is a clear indication of the need for economic reform.
	Another issue is the dependency ratiothe ratio of non-workers to workerswhich is rapidly increasing in the EU. We have an ageing society with a high proportion of non-workers. Coupled with low growth and high public spending, that will inevitably be unsustainable in the long term.

Menzies Campbell: Before the Government came to power, I was one of those who supported the reduction in warheads on the Trident system. The Government implemented that quickly and got rid of the freefall bombsthe WE177sand several other systems. In that regard, the Government have acted properly, but I am not sure that that will be enough to satisfy many of those who attend the NPT review conference.
	If there is to be some long-term agreement with Iran, it should of course cover more than nuclear or security issues. Other issues for discussion and, one hopes, agreement include trade and investment, independence and impartiality of the police and judiciary, freedom of expression and the discriminatory treatment of religious minorities.
	The EU response to the situation in Ukraine has been both well judged and effective and we should take some pride in and confidence from that. The Foreign Secretary will be aware that reports this week suggested that a member of the Commission said no unequivocally to the notion of membership of the EU for Ukraine. The Prime Minister of Luxembourg recently said something similar. In the same reports, it was said that the UK Government were non-committal.
	I do not disguise the fact that Ukrainian membership would present difficulties. The Ukrainian economy for example, is by no means compatible with that of the European Union. The gross domestic product per capita in 2003 was 2,800. In the EU in the same period, the average was 14,900a substantial disparity. Then there are the problems of governance in Ukraine, which recent events have thrown into sharp relief, and the historical relationship with Russia, which the right hon. and learned Member for Devizes mentioned. However, it appears to me that something is going on in eastern Europe, especially in Romania and in Ukraine. It might not be as dramatic as events in 1989, when the Berlin wall came down, with all the consequences that followed. I have the sense that some movement is taking place in countries that previously were thought to be impervious to arguments about the rule of law, an independent judiciary and control of the military. If that is so, we have an overwhelming responsibilityand it would be in our intereststo be responsive to such movement. That is why we should never say never about Ukrainian membership. We should be willing to say that there may be circumstances in which Ukraine's membership becomes both feasible and desirable. The Government have not said anything on the record about that, but I hope that some consideration will be given to it. In particular, the Government should ensure that no communiqu is issued this weekend that appears to bar for ever any application by Ukraine.
	I am in no doubt that in the circumstances presented after the death of President Arafat collective engagement by the EU in the situation in the middle east is essential. Weby which I mean the EUhave, after all, been the largest supporter financially of the Palestinian National Authority, although much of what has been built with the money that we have supplied has been destroyed. Interesting questions arise as to who should be responsible for its replacement. Everything must be done to facilitate the Palestinian elections, which appear to be proceeding remarkably smoothly so far.
	I do not believe that a unilateral withdrawal from Gaza will be any substitute for a comprehensive settlement that does not take account of the right of return, the status of Jerusalem and, perhaps most significantly, the settlements on the west bank. The right hon. and learned Member for Devizes said that the EU should not compete with the US, and he is right. He was right to say that we need a joint approach, but the evidence on which he sought to rely to suggest that some kind of competition is taking place could fairly be described as hearsay evidence, not evidence that one would wish to stand in the way of a joint approach. The EU may be very persuasive, but no one will be more persuasive in Israel than the US. If we are still talking about a two-state solutionas we must doit will require the full effort of the whole Quartet. Most certainly, the European Union should in no sense be competing with the United States.
	I shall finish with a few words about the constitution. My view may be unique, but I think that the constitution is neither the glorious victory that the Government claim nor the shattering defeat that the right hon. and learned Member for Devizes claimed. The constitution is a sensible balance; it enshrines properly, once and for all, in one document rather than several, the relationships that are at the heart of the European Union. In the course of this weekend, I doubt that the constitution will come under much discussion. In the UK, discussion about Europe may never be brought to a conclusion, but it will certainly not be brought to a proper state of consideration unless and until we have the opportunity provided by the referendum to which the Government are committed. The sooner that day comes, the better.

Keith Vaz: It is a pleasure to follow the right hon. and learned Member for North-East Fife (Sir Menzies Campbell). He speaks with great authority on these issues and I disagree with little that he has said so far.
	I agree that it is important for the Government to continue campaigning on Europe, but do we not need a date for the referendum campaign? Ministers and Members would then be able to go out to the country to talk about Europe. In fact, it would be much better if we did that in advance of a referendum campaign, because the European project is such an integral part of our foreign policy that we should not need an artificial reason to start talking about it.
	I pay tribute to my right hon. Friend the Foreign Secretary for his work on enlargement. It is right that Britain has been the champion of enlargement over the last few years, starting with the Prime Minister's speech in Warsaw five years ago. It is also right that the Foreign Secretary should point out the importance of Turkey's membership of the EU, for all the reasons that he set out, and because once Turkey joinsas I hope it willEurope will never be the same again. Turkey will bring a new religion to Europe, through the Muslim faith, as well as different cultures. We should see that as a positive development in the history of Europe. We should take into consideration, too, what the right hon. and learned Member for North-East Fife has just said about Ukraine.
	Turkey's association with the European Union began in 1963 when it signed its first agreement with the EU, with the eventual promise that it would join at some stage. That is almost 41 years ago, so the forthcoming European Council will have historic connotationsat last, we shall be saying to Turkey, Let us begin the negotiation process.
	Of course, it is right that Turkey should meet all the criteria of every other country. It would be quite wrong if we changed the rules for Turkey or had a different standard from that for other countries. I hope that the go-ahead will proceed this weekend and that when the Prime Minister returns on Monday he will tell us that it has been achieved at last and that negotiations can begin. Whether the process lasts for five years, 10 years or more, I hope that Britain will be at the forefront in developing relations with Turkey and ensuring that not only our trade relations but also our people-to-people relations improve.
	The comments of the right hon. and learned Member for Devizes (Mr. Ancram) were interesting. It was Conservative policy to hold a referendum on enlargement, yet the Conservatives now claim to be fully supportive of the enlargement process. They argued in favour of a referendum on Nice, but if we had had such a referendum it is possible that enlargement would have been blocked. When the shadow Minister for Europe winds up the debate, I hope that he will reassure us that there is no question that a Conservative Front Bench will call for a referendum on the admission of Turkey to the EU when that eventually happens.
	As I said in my intervention, I am concerned about public opinion in countries such as France. The latest opinion polls suggest that 70 per cent. of people in France oppose the entry of Turkey, so I am glad that President Chirac will be appearing on national television in France tonight to argue the case for Turkey. It is extremely important that Governments begin to talk about the enlargement process at an early stage. We did so only at the last moment in respect of the enlargement of 1 May.
	It is important to note that, despite the hysteria surrounding the entry of Poland, the Czech Republic and the other eastern European countries, and the predictions of the Conservative party, the Daily Mail and its sister papers, a huge number of people have not entered the UK. In fact, enlargement has gone extremely well. The people who have come over have taken part in the registration scheme; they are contributing to our economy, although of course they send remittances to their countries of origin, and are strengthening it by their presence. We should welcome that. I think the same will happen when Turkey joinswhenever that is.
	I hope that the Government will fashion a policy on the freedom of movement of Turkish citizens at a very early stage. We do not want a repetition of what happened just before 1 May, when there was a slight change in the Government's position and registration was introduced. I argued very much against the need for registration and I think that view has proved correct. Let us get things right now. Let us tell the Turksas potential fellow partners on an equal basiswhat we plan to do about freedom of movement, so that nobody misunderstands our position.
	The enlargement of 1 May will not be a huge consideration this weekend, although no doubt progress will be noted when the 25 Heads of Government meet around the table. I hope that we can do more to build the new member countries into the existing structure of the EU. Recently, I looked at the number of European agencies and how many were sited in the various EU countries. Obviously, there are no European agencies in the new member states and no plans to hold European summit meetings in any of them because of the deal struck in Nice, which was, as I recall, undertaken to make the Belgians feel a little happier. That is why so many European Council meetings take place in Brussels. Now would be a good opportunity to move one of the agencies from the old 15 to the new 10. Perhaps one of them could be in Prague, Warsaw, Cracow or one of the other new EU countries. It is essential to show that the enlargement process did not end on 1 May. If those countries are to be full and true members of the EU, we should be willing to hold more summits in them and move more of the agencies to them. The new members would feel reassured by that.
	The right hon. and learned Member for Devizes mentioned the Lisbon agenda, which will, I am sure, be discussed at the Council this weekend. He was wrong to say that the Lisbon agenda was a failure; it was not. The difference between what happened at Lisbon and at other EU summits was that for the first time economic reform was benchmarked. It was part of that process to review the Lisbon agenda after five years to see how well the European countries had done. In fact, the Kok report, published a few weeks ago, makes it clear that Britain has done well, as opposed to some other EU countries. We have not done as well as the Scandinavian countrieswe would expect to see Sweden, Finland and Denmark right at the top, partly due to their population sizebut the economic reform agenda that our country is pursuing was praised in the Kok report. The House will know that the 112 indices have been reduced to 14 core indices, but we are in the top tier in a number of cases. So it is wrong to say that we have not done well out of Lisbon. Of course we can do better, but the Kok report is very clear. I am sure that the shadow Minister, the hon. Member for Altrincham and Sale, West (Mr. Brady), will have read that report, and he will know that we have actually had a good report, but we need to do better.

Keith Vaz: The hon. Gentleman is rightwe have been an economic success in the United Kingdom because of the policies pursued by the Chancellor of the Exchequer. He is right also to say that the Kok report does outline a number of serious criticisms. The point of having a report of this sort is that when we look at Lisbon, five years on, as we shall do in the spring Council next year under the Luxembourg presidency, we shall at least have the basis for ensuring that there are action plans. The hon. Gentleman will know, because he has read this report, that what is being suggested is that each member state produces an action plan between 2005 and 2006, so that when we get to the spring Council in 2006 each EU country will have an action plan detailing what they will do as a result of the Kok report.
	I am very pleased that only yesterday, the Secretary of State for Education and Skills appointed Will Hutton a member of the Kok team, to lead for us in conducting the gap analysis that is being sought to see why we have fallen short of the criteria that have been set out. A gap analysis in the area of learning and skills and education is very important. I know from my time as Minister for Europe that these reports are wonderful, summits are all wonderful, and everything is always such a success in the European Union, but since we have this detailed report we need to act on it, and yesterday a domestic Department has decided to become the first of our Departments of State to ask a personWill Hutton, an excellent choice as he served on the Kok committeeto produce a gap analysis so that we know where we are going wrong, and that report will be ready. I want to see other domestic Departments doing the same thing. The predictions of the hon. Member for Stone would be correct if a similar approach is not taken by the Department of Trade and Industry and other Departments that are affected by economic policy. So, we have to take those criticisms; we have to accept that we need to do better. The proposals put forward yesterday and the proposals that will emerge from Departments will be very valuable in ensuring that we get our action plan in place.
	I also want to raise an issue that I have raised at every one of these Adjournment debates that has been held before a European Council meetingI know that the Under-Secretary of State for Foreign and Commonwealth Affairs, my hon. Friend the Member for Sunderland, South (Mr. Mullin), will take a note of this so that he can pass it on to the Minister for Europeand that issue is reform. On 25 February 2002, our Prime Minister, Mr. Aznar and Gerhard Schrder wrote a joint letter on reform to the then European President. The point that we raised then was that there were key areas that needed to be looked at, and I raise it again because I hope that we shall have some answers at the end of the debate. How many of those points mentioned in that letter of 25 February 2002 have actually been realised? How many boxes can we tick? When I last raised this, we did not have an answer, but I am giving notice because I hope that information will be passed to the Front Bench by the time of the winding-up speeches.
	There is no point in our taking brave leadership positions in Europe, as our Prime Minister has rightly done, if the rest of Europe does not follow. Our job is to ensure that if we set benchmarks, we know whether they have been realised, and I think that four years is long enough to have looked at this process. I have said before that the people of Britain will never learn to love the EU until the EU learns to love reform, and that means that we need to explain to the people of this country, on an ongoing basisnot just if, but when the referendum campaign is calledthe benefits of membership of the European Union. I know that my hon. Friend the Member for Birmingham, Edgbaston (Ms Stuart) tried to do so during the process of formulating the European constitution, and, to give him his credit and his due, so did the right hon. Member for Wells (Mr. Heathcoat-Amory) when he sat with her on the Convention. They went out and tried to discuss these issues, and I have received many invitations to events all over the country where they have been speaking on them. That is exactly what we should be doing.
	The right hon. and learned Member for Devizes, instead of knocking the EU all the time, should be supporting what Britain is doing. We know where he really stands on this issue. We know that he has to adopt a hard-line approach because he speaks for the Conservative party, but we know where his heart really lies on Europe. Unlike others in his party, he wants to stay in the European Union. I will not mislead people by saying that that is not what he wants to do. If that is what he believes, he should be spending his time supporting what Britain is doing, as we spent our time supporting what Government Ministers did before 1997.

Keith Vaz: I know that I cannot convince my hon. Friend of the merits of the euro, and I do not know whether I can convince him of the merits of being in the European Union, but the fact is that the Lisbon agenda is not just about economic reform; it is also about all the other things that go with social policy. If we have failed to explain that to people it is our faultEurope can deliver these benefits, but we have not explained them to people in places like Luton, Leicester and Manchester, and that is our failure.

Keith Vaz: My hon. Friend is right. She has great knowledge of these issues, and my experience and her experience, having sat on the Convention, are similar. Before these initiatives take root in the European Commission, and in all those great directorates-general they have all over the place, they need to be discussed here in the House. I believe that the proposals made by the Foreign Secretary and the Leader of the House for proper scrutiny of European affairs, merging all those various Committees into a Committee that really has teeth, are the way forward. I believe that on European issues we should take the route that we took on the Convention, when my hon. Friend the Member for Birmingham, Edgbaston and the right hon. Member for Wells kept coming to the House to report back and seek our views. I believe that the idea of a second Chamber has gone nowI do not think that we shall get thatand that means that we must take a much greater role in ensuring that scrutiny takes place.
	I want to end by briefly talking about the EU presidency, which will come to us in July next year. We are already starting to work on the presidency agenda, and this European Council gives us the opportunity to take forward a number of themes. Obviously, the enlargement theme can be taken forward, as will the Lisbon agenda, but I hope that we can develop the theme of Europe being more than just the original countries that joined or the 15, because we are now a Europe of 25a Europe of many cultures. We should be proud of the differences in Europe and celebrate them, rather than seeking to find excuses about why Europe does not work.
	The Dutch have done extremely well in holding together this presidency. I recently visited Holland to look at the aftermath of what has been happening there. They have had some awful problemsnot just the assignation of political figures, but at least 17 mosques have been subject to arson attacks. They are going through their own identity crisis and they have held together the presidency so well. We should learn from what has happened in Holland this year and we should ensure that we push forward the idea of not just an economically prosperous Europe that is able to compete with the United States, producing the jobs that we have not had in the past 10 years, but in the words of my hon. Friend the Member for Luton, North (Mr. Hopkins), a socially responsible Europe that does not involve us in giving up one iota of our economic success.
	I wish the Prime Minister and the Foreign Secretary well in their negotiations this weekend. If the go-ahead is given to Turkey, Britain will have achieved yet another major success, but I hope that all the other points that I have mentioned will also be pursued because we need to change Europe for it to get better.

William Hague: In listening to the debate, I feel that I am now taking part in the affairs of a very distinguished but small dining club that meets every six months or so to discuss European affairs comprised of people who are Ministers for Europe, who have been Ministers for Europe or who aspire to be Ministers for Europe, among whom I certainly do not count myself. It is a very distinguished group, in which my right hon. and learned Friend the Member for Devizes (Mr. Ancram) asks pertinent questions and the right hon. and learned Member for North-East Fife (Sir Menzies Campbell) gives a tour d'horizon of world affairs, which he did very well, rightly pointing to reasons for optimism in the affairs of eastern Europe, particularly Romania and Ukraine.
	It is evidently the Foreign Secretary's job in that club to assure us that there is no need for concern, that it is fairly much business as usual and that the European Council is coming up, at which the matters for discussion are enlargement of the EU, the treaty that is on the table and perhaps the defence of the British rebateall from the point of view of a Government who are more pro-European than the public as a whole. That could have been said more or less of any European Council during the past 10 years, under the last Government, as well as under the current Government.
	One might easily get the impression if one had just nipped into the debate that nothing had really changed much in recent years. My concern is that that is not the true background to European affairs. Immense forces are at work in the world far beyond the boundaries of Europe, and in 10 or 20 years' time European Affairs debates in the House will be set against a much darker background than today. The loss of public confidence in the EU's institutions in this country is becoming greater with each month that goes by, and that will have a dramatic outcome in the months and years ahead.
	Of course, all that might, to some extent, come to a crunch in the coming referendum on the European constitution, which evidently will be held whoever wins the general election, although the Government seem most anxious, despite the fact that they think it is vital to the future of Europe, to ensure that the constitution and the preparations for its ratification are not debated in the House this side of the general election. Those who advocate a yes vote in the referendum will find their job dramatically harder than those who advocated one in 1975.
	The right hon. and learned Member for North-East Fife looked forward a few moments ago to being there with my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke) and perhaps the Foreign Secretary, and they will paint themselves as the moderate and informed opinion of the nation, against the rather extremist forces that might try to persuade people to vote no. That was the successful approach of the pro-EU sidepro-EEC, as it then wasin 1975, but hon. Members of all points of view recognise that that will be much harder in the coming referendum.
	It will be a much harder referendum for the yes side to win for several reasons. First, those who are old enough to remember the 1975 referendum feel that they were misled at that time because they were not told of the political as well as the economic consequences that would follow from a yes vote. Secondly, those who are not old enough to remember 1975 have grown up in an entirely different world, in which they have benefited from many aspects of the EU.
	The framework for co-operation that it has created, the reinforcement of the rule of law and the encouragement of democracy in certain countries and making war unthinkable between most of the countries of Europe are all real achievements, on account of which I am not in favour of a withdrawal from the EU. I believe that we must strive to make our membership of the EU a success, but the idea of ever-closer political integration of countries' institutions and the EU now seems out of date. Ever-closer political integration is an idea whose obsolescence has already come for a younger generation, who are entirely different from the young people of the 1970s and have a different outlook on world affairs. Part of the reason is also economic. We need not belabour the point today about the differences in gross domestic product and employment growth they have been mentioned alreadybetween this country and many of the eurozone countries in recent years.
	So the debate has moved on, and a sure sign that it has moved on is the variation in the statements of the irrepressible Minister for Europe, who is grimacing because he does not want his remarks to be dragged out again. He is the Member of Parliament for my original home townRotherhamand he is such an endearing figure and his remarks are so wonderfully indiscreet at regular intervals and so marvellously inconvenient to his colleagues that we really hope that if the Home Secretary does not survive his current career crisis the Minister for Europe can be put into the Cabinet so that we have a source for what is going on there.
	The Minister for Europe's remarks are incredibly useful and incredibly revealing. He has declared that the euro is economically irrelevant. Indeed, he now says that it is a fetisha brave thing to say in the current circumstances. That is the same Minister who only last June at a breakfast meeting of the London chamber of commerce declared that if we joined the euro
	our trade with the eurozone could leap by 50 per cent . . . Our national wealth could rise by 9 per cent.
	and that it would produce
	cheaper goods and services for British consumers.
	That is now irrelevant, apparently. Whatever one might say about those assertions, they are debateable, but to say that an increase in our national wealth of 9 per cent. is irrelevant is quite remarkable. He now says that he tried to persuade Ministers to
	Stop going on about the euro.
	It was incredibly far-sighted of him to try to dissuade them from talking about a policy to which he was so wholeheartedly committeda foresight rarely granted to any hon. Member.
	What is actually going on? The Minister for Europe has not really changed his views; they are well established and well known in private and in public and in the House. What has changed is that that topicthe eurohas become unsaleable to the people of this country, and it has become unjustifiable on the basis of economics. One has only to look at how the eurozone struggles with inflation, which is gathering in some of the eurozone countries, whereas there is economic stagnation in othersthe first threat of stagflation, which we last saw in the 1970sto see how gravely the economic case has been weakened, and he knows that there is no longer any substantial body of opinion in British industry, finance or commerce in favour of joining the euro.
	My right hon. and learned Friend the Member for Devizes referred to the roadshow that was going to be launched by the hon. Member for Leicester, East (Keith Vaz), which Members of all parties would join to rouse millions of people in this country into a frenzy of enthusiasm for joining the euro. We have not seen much of that roadshow in recent years.

William Hague: The hon. Gentleman did have a roadshow, but it went on a pretty short road and did not get round most of the country. Mine reached more parts of the country than his, albeit with no greater effect, I readily concede. The assessments of both the Prime Minister and I of the chances of Britain joining the euro at the time of the last election were wrong. I thought that there was a serious possibility that Britain would join the euro in this Parliament if the Labour party was re-elected, and I think that the Prime Minister did, too. Our assessments were both wrong, but that was why I talked about it during the last election and he did not. The opportunityif one can refer to it as suchhas now gone by, and I do not think that it will recur.
	The public's sentiment about European institutions and what has happened regarding the case for the euro are signs that greater forces are at work that will affect European affairs in the years to come. It is always instructive to talk to Chinese leaders. I have been in favour of listening to them ever since they turned up at the bicentenary of the French revolution. When one was asked whether the French revolution had been a good thing in the history of the world, he said, It is too early to tell. Chinese leaders are always good at putting things in perspective. I had the pleasure of meeting them when I was Leader of the Opposition, and when I talked to Jiang Zemin about education in England, he said, Ah, there are more people studying English in China than there are English people in England, which put things in perspective.
	It is now commonplace to observe what is happening in the Chinese and Indian economies and the importance of the economic change that that is bringing to the world. However, it is less commonplace to understand the speed and scale with which that is happening. Eurozone managers want 2 per cent. economic growth a year, but China has 9 per cent. growth a year. As many forecasters say, there is every prospect that in 20 years, both the Chinese and Indian economies will be larger than the European economy.
	Recent signs in the eurozone economy are not encouraging. The demographics of European countries are terrible. Again, that fact has become more widely understood, but the speed and scale of the change on the cards is less widely understood. Later this century, steep falls in the populations of Germany, Italy, Hungary and several other countries are in prospect. On top of the unfunded pensions and expensive welfare systems that many countries face, we do not know what such population trends will do to societies. We know that they will create more difficulties with pension funds and that businesses should sell zimmer frames rather than baby-care products, but we do not know what they will do to a society's optimism and ability to innovate. We do not know whether they will make a society more conservative and more or less prone to save.
	The long-term outlook is uncertain because of demographic and economic trends. The European Commission has forecast that within what we hope are our lifetimesa few decadesthe extent to which the European economy will make up the world economy will go down from 20 per cent. to 10 per cent., while that of the United States will continue to advance from 23 per cent. to 26 cent.
	Such figures are just statistics, but behind the statistics, as ever, there will be millions of human stories. The talent, capital and dynamic forces in the world will head east and west rather than spending time in the European Union. Many people in Europe will miss out on the activity, progress and pioneering in the world and they will not like it. The United States will look elsewhere for its economic and political alliesto countries such as Brazil, South Africa and Australia. There will be immense political, economic and social strains on the European Union and its citizens, with perhaps the greatest loss of influence, relative prosperity and future potential experienced by any group of countries in peacetime in the modern world.
	It is no exaggeration to say that that situation faces European countries over the next 20 years. One would think that it might be on the agenda of a European Council on top of the many routine matters that must be discussed because it is the main thing happening in the world. However, perhaps it is creeping on to the agenda. The report from Mr. Wim Kok has already been mentioned in the debate and it gives a similar message. It says:
	Europe has lost ground to both the US and Asia; its societies are under strain; and some ugly political forces are beginning to manifest themselves.
	He and his colleagues say:
	What is at risk in the medium to long run is nothing less than the sustainability of the society Europe has built, and to that extent, the viability of its civilisation.
	Those are strong words, but not excessively strong, given the evidence.
	What is the collective response of European Governments? It is largely paralysis. There is a monumental failure of leadership. Those Governments often fail to recognise the problems or to explain them to their people. The structure of the European Unionas it is now, and as it would be if the proposed constitution were ever ratifieddoes not make it sufficiently cohesive to respond to such a threat, and does not give its member states the freedom to respond to that on their own, so we have the worst of every world.

John Bercow: I am grateful to my right hon. Friend for giving way, and I apologise for being absent for a great deal of his speech. Since the Minister for Europe seeks intelligence and clarification, does my right hon. Friend not think it a matter of the utmost seriousness that the report of the European Court of Auditors found that no less than 89 per cent. of the humanitarian aid to Zimbabwe was lost through fraud?

Gisela Stuart: It is a privilege, but also a huge challenge, to follow the right hon. Member for Richmond, Yorks (Mr. Hague), not least because he tends to be so much more eloquent than many of us. I was struck by his analogy when he said that this was like a dining club. It seems also to be a terribly all-male one. That has certainly been my experience on the European Convention.
	I am sad that the right hon. and learned Member for North-East Fife (Sir Menzies Campbell) is no longer present, because when he was explaining his commitment to the European Union, I suddenly thought, Yes, this is the problem; it is old men dreaming. I do not mean to be unkind. For those of us in the post-war generation, our dream of the European Union was fulfilled in 1989, when the Berlin wall came down, and in 2004, when eight former communist countries came into the European Union.
	The real problem is that we have not come up with a new dream that engages young people, who take it all for granted. When I tell my children that Germany and France will never go to war again, they say, That's very interesting, mum, but I never thought that they would go to war anyway. That is a part of the problem. We think that the European Union is a fragile creature and that it will collapse if we question anything that happened in the past. Far from it: we need to look at it in a new way.
	I want to look at parts of the European constitution as it stands, assuming that it will be accepted, and to put them in the context of the negotiations about the accession of new countries and the question whether that would work. My assumption is that none of the political parties across Europe will spend the amount of political capital that they will need to spend to get the constitution ratified in the interests of a document that they do not think will see us out for at least the next 10, 15 or 20 years, given that once they have committed themselves to referendums on these treaty changes, it will become very difficult not to have referendums on future such changes.
	I therefore thought that I would go back to the text and try a modelling exercise. There are now 25 member states, we know that Romania and Bulgaria will come in soon and we have started negotiations with Croatia. Turkey is knocking on the door, and I want to make it clear that I am absolutely in favour of its accession. We have to find a way of bringing Turkey in, and not through some different sort of agreement status. We have to make it possible for it to be incorporated.
	When we look at the map of Europe, however, we see a big gap in the western Balkans. We will have to get to a point, probably more speedily than we think, at which quite a number of other countries can accede. There will be a lot of very small countries. We can even talk about Serbia and Montenegro, although I am not entirely sure whether that union is sustainable, as well as about Macedonia, Albania and Kosovo. We are potentially talking about a European Union of 34 or 35 members.
	The European Union is built on a structure that has always given disproportionate rights to small countries. That was fine when we started with a European Union of three big countries and three small ones, but it continued. In a European Union of 25 members, we have roughly six bigs and 19 smalls. In respect of the constitution as it stands, the institutional agreement limits the size of the European Parliament to 750 Members, but it also gives a minimum of six seats to every country. Expansion towards 35 member states therefore squeezes the countries in the middle.
	We are also saying that every country should have one commissioner, but the proposal on the constitution acknowledges something that I think is very importantthe need to try to reduce the size of the Commission. It proposes that, by 2014, only two thirds of countries will have a commissioner. That will not get us anywhere, however. By the time we get to 2014 and look at a European Union of perhaps 35-plus members, the Commission will have 20-plus commissionersa size that we have already said is too big. Is that structure sustainable, and will it be accepted by the key members as we expand, as I think we need to do?
	One of the countries that may enter the European Union has a very high population, and the definition of qualified majority voting as it stands in the European constitution has a population-based element. On that basis, I wonder whether Germany and France will be prepared to accept a European Union in which Turkey has higher voting rates than they have. I do not know the answer. If we really want to look ahead over the next 15 or 20 years and to have a European Union that can expand and develop, is the constitutional treaty as it stands a vehicle that allows us to do so? That decision has to be made at some stage.
	I also wonderthis is a technical pointwhether, between now and any ratification, there is still a mechanism to clarify some points in the constitution and to make them legally clearer. The issue arises out of something that I came across in close reading about the presidents of the Council and the Commission. I remember the debate on this issue in the Convention. The original draft made it clear that the President of the Commission and the president of the Council could not be the same person. There was a specific line to exclude that possibility, but it was removed, and we now have a statement that the office holder may not also hold a national mandate. There is also an argument that, in the treaty as it stands, as a commissioner may not hold any other office, that means by implication that they should not hold any other European office.
	What I am disturbed about is that, in evidence to the Dutch Parliament, Dutch Ministers made it clear that it was their aspiration that the offices should eventually be held by one person. Furthermore, Dutch legal services clearly stated in evidence to the Dutch Parliament that they thought that the correct legal interpretation was that it would be possible for the offices of President of the Commission and president of the Council to be held by one person. Of course, as the treaty stands, both those people will be appointed by qualified majority voting. As I understand it, the British Government are clear that they want those positions to be held by separate people, and I wonder whether it is possible clearly to state some basic understandings of the facts.
	I congratulate the Government on the publication of their short guide to the European Union, which goes some way towards giving an understanding. They were right to explain past developments and what the European Union means and does. Even among colleagues, real understanding of how the operations work and what the Council of Ministers does is sadly lacking. As hon. Members have already said, it is a shame that we tend to have a narrow focus in debates such as this, and that the domestic Departments are not more involved, so as to give us some indication of domestic policy.
	While Ministers are going to the Council meeting, debates about the budget are also going on. Politically, the budget debate is in many ways far more significant than debates about the European constitution. I wonder whether it is wise to make the British rebateit is called a rebatesuch a political totem. I happen to have great sympathy with the point made by the right hon. and learned Member for North-East Fife, who said that it is the outcome that really matters. If I had been a poker player, I would have put the British rebate on the table and said, It comes at a pricethe common agricultural policy.
	When I travel across Europe, as I still do now and then, I find that colleagues talk not about whether the British rebate will be challenged, but about when it will be challenged. I recall extensive discussions with a former commissioner, Henning Christophersen, who was also a member of the praesidium of the Convention. If we examine the rebate in closer detail, it is not worth as much as it seems, because we do not get certain other payments because of it. The removal of the rebate and the CAP would result in long-term gain for both the UK and for the long-term sustainability of the European Union. Between now and the referendum, I hope that both sides occasionally generate a debate informed by facts rather than misunderstandings. One of the great virtues of the referendum is that people will make up their minds on what they want to see in the future. People do not have an appetite to leave the European Union, and they want the EU to work.
	When negotiations over the constitution broke down at Christmas last year, it was because Spain and Poland refused to sign up. No one, but no one, suggested that Spain and Poland could always leave the EUbizarrely, Poland had not even joined at that point. Why does the analysis that if a country says, No, it must leave apply only to the United Kingdom? I cannot understand that.

Kelvin Hopkins: Was it not the case that, when the talks broke down because of Poland and Spain, Whitehall experienced a palpable sense of relief that the matter would not return to the agenda for another seven years? Unfortunately, it has returned.

David Heathcoat-Amory: I am pleased to follow the hon. Member for Birmingham, Edgbaston (Ms Stuart). I miss our weekly visits to Brussels as members of the Convention on the Future of Europe, which drew up this wretched document. When the constitution fails, perhaps we will be sent out again to do a better job and will listen to the instructions given to the Convention, which were not to write a constitution, but to create a more democratic Europe that is closer to its citizens.
	I agree with many of the hon. Lady's observations, and particularly those on Turkey. Those of us who want to draw Turkey in a European direction should be extremely worried about the constitution on those grounds alone. In my view, the constitution will make Turkey's accession almost impossible. Indeed, I shall go further: apologists for the European constitution sometimes say that enlargement10 countries joined in Maymakes it necessary. In fact, the opposite is the case: greater variety and diversity in Europe make the case for a more varied treaty relationship and count against the command and control mechanism that is entrenched in this European constitution.
	I was interested in the hon. Lady's question, which I hope that the Minister for Europe will answer, about whether the President of the Commission could be same person as the President of the Council of the European Union. The Foreign and Commonwealth Office is adamant that that could not happen under the constitution, but I have received legal advice that the situation is ambiguous. That matter needs clearing up. Any idea that the constitution brings clarity, certainty and finality to those difficult issues of who does what in Europe is clearly at variance with the fact that large chunks of it are already subject to different legal analyses by different lawyers in different countries.
	I have the final documenta Christmas paperback landed on my desk a week ago. I do not know whether it was sent to all my hon. Friends or just to me, on the grounds that I am most likely to read it.

Denis MacShane: As the House is sparsely attended, perhaps the right hon. Gentleman and I can have this dialogue. All the actions that he describes are carried out principally by the Commissioner for External Relations. Article I-28 of the new treaty says that the new European Minister for Foreign Affairs will carry out policies
	as mandated by the Council.
	That means that he or she will need the unanimous agreement of the Council of Ministers of all 25 member states before he or she can do anything. For the rest, he continues the work currently carried out by Mr. Patten, who has just retired as External Relations Commissioner.
	The right hon. Gentleman is making heavy weather of this. I understand his general opposition, but he should not be unfair on a very accurate and precise document produced by our civil service in the Foreign Office which provides a neutral description of what is in the treaty.

Denis MacShane: Again, the European Union cannot be a member of the UN Security Councilonly its sovereign member states can. That is why Germany is seeking its own independent permanent seat on the Security Council. The existing practice in general UN bodies and discussions where the European Union has a common policy as represented by one of its functionaries is what is stipulated in the treatyit carries on existing practice. The right hon. Gentleman knows as well as I do that the EU cannot become a member of the United Nations. With respect, he should notI suppose that he has todescribe this procedure in a way that does correspond to the reality of what is in the treaty or is the legal basis of how the UN can operate.

David Heathcoat-Amory: I hesitate to correct the hon. Lady, but she knows that the charter covers not only EU institutions but member states when they implement EU directives or regulations. As I said earlier, the constitution states that the EU will be able to legislate on research and development. It is therefore entirely plausible that the EU will pass laws on scientific research that member states have to implement. A scientist could therefore easily appeal to the European Court of Justice if he were restricted in any way. Even the hon. Lady's comments do not undermine my point that the right is new. Nothing like it exists, and that contradicts the assertion in the document to which I have alluded.
	If Government literature is inaccurate and the original text, which I have in my hand, is ludicrously long, how will people make up their minds about the European constitution? I suspect that they will do that by asking themselves some simple questions: do they want more powers to be transferred to the EU? How have the existing EU institutions discharged their current powers?
	On transfer, there can be no doubt. The Union advances into new areascompetencies, as they are calledsuch as criminal justice. Sixty-three new matters will be subjected to majority voting for the first time. The excuse for that is that it will make the EU more efficient. By efficiency, the ability to pass more EU legislation is meant. Last year, the European Scrutiny Committee, of which I am a member, examined 1,080 new proposals from the EU. We do not therefore suffer from lack of EU legislation. The Foreign Secretary said in his opening remarks that the Commission was girding itself to repeal possibly up to 100 items of legislation. That is a tiny percentage of even one year's output from the current EU under the existing treaties.
	The pamphlet gets one thing right when it states that the constitution
	gives national parliaments the power to ask for changes to proposed European laws.
	Thanks very much. We shall have the power to request changes. We have that at the moment, but we do not have the power to do anything about the avalanche of new regulations. The Government regularly mention the need for fewer business regulationsI have lost count of the times I have heard Ministers claiming that it will all be different in future. They say that the EU has turned over a new leaf and often point to conclusions at the end of European summits, where it is solemnly agreed that the EU will regulate in future only when absolutely necessary. I shall give only one example to the contrary.
	In the new Session, we must transpose into British law the art resale levy, known in French as the droit de suite directive. It insists that, when a work of art by a living artist is resold, a small percentage has to be collected and paid to the artist. It applies in France and Germany, with the result that works of art of any value are sold not in France or Germany but in London. Under majority voting, with the British Government, I am glad to say, voting against it, the new directive will be imposed on the British art market. American art dealers cannot believe their luck. Expensive and valuable works of art will be taken from the London art market, flown across the Atlantic and sold in New York where, of course, the levy will not be paid.
	Yet the EU and the Government signed up to the Lisbon process, which is supposed to be about competitiveness and making us a high growth zone in the new global business environment. It would be comic if it were not so tragic. Of course, the constitution contains nothing that will do anything about the matter. Indeed, it will make matters worse because the Union is now advancing into new areas such as energy. New majority voting will overwhelm us in the remaining matters where we continue to have a veto.
	Let us consider the point about whether existing institutions discharge even their current budgetary powers efficiently or effectively. I can add little to the comments of my right hon. Friend the Member for Richmond, Yorks (Mr. Hague) on the subject. He mentioned Marta Andreasen, whom I met last week when she came to London to give a speech. I had dinner with her and others afterwards and it was sad to hear her recount her lonely struggle to bring some sense into the European accounting system. She described how European accounts do not even have double entry bookkeeping. That was invented 500 years ago in Venice but it has not yet reached Brussels. We are considering not a small amount of money but a budget of 100 billion euros a year. Mrs. Andreasen, who was the first qualified accountant to be made chief accountant, did what any accountant would do. When she discovered the mess, she started to complain about it and see her superiors. She was eventually sacked for disloyalty, and it is particularly shameful that the European Parliament, which is supposed to stand up for the rights of taxpayers, refused to give her a hearing. During the whole messy business of her dismissal, another scandal arose in EUROSTAT, the agency that draws up official statistics for the European Union. It was found to be riddled with fraud and error, and slush funds and hidden accounts were discovered. Once again, no one lost their job. The only people who lose their jobs in the EU are the whistleblowers, who draw attention to the problems in the first place.

Tony Baldry: It was worth turning up to this debate just to hear the hon. Member for Luton, North (Mr. Hopkins), who represents a species of politician that I thought had died out with the Labour Euro-Safeguards campaign. The Minister for Europe can never again dare to associate the no campaign or Euroscepticism solely with the Conservative party. We have just heard the authentic voice of Eurosceptic Labour, and even the word comrades was used. Clearly, it is worth hearing that voice more often, explaining the Euro-Safeguards campaign. I thought that people who used such language had all been purged from the new model Labour party.
	I give advance warning to the House that my speech this afternoon will have two parts. The first part will be very bad tempered, and the second very tedious.
	I shall begin with the bad-tempered bit. European policy affects pretty well everything that we do in this House, and in this country. It is not acceptable that it is debated only in the European Standing Committees and the Select Committee on European Scrutiny.
	As Chairman of the Select Committee on International Development, I was fortunate enough to be able to attend the trade negotiations at Cancun, and I am grateful to the Government for that invitation. However, that visit brought it home to me that the EU negotiates in those areas, such as trade policy, where it has total competence. Pascal Lamy had very little time to brief Ministers from the nations involved about what was happening in the trade negotiations. In fact, the Secretary of State for Trade and Industry spent a large chunk of her visit in Honduras, where she opened an embassy and a new office for the Department for International Development. I am sad to say that the office was closed recently because of cuts in the relevant bit of DFID's budget as a result of extra spending on Iraq.
	I shall speak about trade policy later, which is now an EU competence. We ought to have a debate on EU trade policy at least once a year, with the Secretary of State for Trade and Industry at the Dispatch Box.
	The House will know that my principal interest in this House at the moment is my chairmanship of the International Development Committee. We have lots of cockshies: we had one today in DFID questions, and when the hon. Member for Luton, North (Mr. Hopkins) spoke a moment ago about EU development assistance. All sorts of arguments can be put forward about the external affairs budget, and so on. We never have a coherent debate in the House on EU development assistance at which the Secretary of State for International Development gives an account of the quarter of all UK development spending that goes to the EU.
	Not long ago, the International Development Committee published a report on migration and development, including many issues that relate to the European Union, such as migration policy and the recruitment of doctors, nurses and other skilled people from developing countries. We did not have a debate on that.
	Twice a year, we have these debates on Europe, but they are like group therapy sessions. The usual suspects turn up and make pretty much the same speechesthey are good and enjoyable speeches, but we do not move on much. My bad-tempered point is that the Procedure Committee should look at how we can find more time for debates on the Floor of the House on specific motions on Europe and EU policy, rather than just these general debates twice a year, which are no proper substitute for accountable debate. The Minister for Europe is an honourable man and I am sure that he will ensure that Ministers in other Departments read what colleagues on both sides of the House have said today on specific policy areas, but no coherence will emerge if we just have these group therapy sessions.
	The comments made by my right hon. Friend the Member for Wells (Mr. Heathcoat-Amory) were important. At some stage before the end of this Parliament, we should have a proper debate on the constitution. I am prepared to bet any amount of money that the Government business managers will do anything other than have a debate on the constitution on the Floor of the House before this Parliament finishes. If an issue is as important as our membership of the European Union, we should give more time to specific motions on it on the Floor of the House.
	It is now time for my tedious bit.

Tony Baldry: Well, the tedious bit will be really tedious.
	The International Development Committee recently took evidence from officials from the Department for International Development and the Department of Trade and Industry on Cotonou. We all left the meeting feeling that we had failed the Houseand the House itself had failedby not giving any proper attention to Cotonou and its potential impact on developing countries. It is certainly as important as Doha. Glenys Kinnock, who was co-president of the ACP-EU joint parliamentary assembly, described Cotonou as the bedrock of Europe's development policy, but there has been little debate about it in this House. Indeed, since Cotonou was agreed in 2000 and trade negotiations begun, only one articlethat I could findhas been published in the UK press. There have been no statements to the House on Cotonou.
	A few weeks ago, the Under-Secretary of State for International Development was in Brussels to discuss issues surrounding Cotonou, but no subsequent statement was made to the Housenot even a written statement in Hansard. On 3 December, there was a ministerial meeting to review the Cotonou agreement, but again no statement was made to the Housenot even a written one. On 2 December, there was at least a debate in Westminster Hall on the Caribbean and that brought the first mention of Cotonou in the House since an oral question three Sessions ago. These trade negotiations will have a significant impact on Caribbean countriesa quarter of the Commonwealth is in the Caribbeanand on the many poor, least developed countries in Africa and the Pacific. Indeed, the Prime Minister is talking about a Commission for Africa next year.
	The Under-Secretary would not have volunteered any information on Cotonou in Westminster Hall unless he had been prompted to do so. Even then, he gave us only a short paragraph that had been passed to him by officialsand that was despite having been in Brussels the previous week to discuss Cotonou and at a ministerial meeting on the issue the next day. The coalition against the European Commission's proposals on Cotonou is widespread. The solitary press article to which I alluded earlier appeared in the Financial Times almost two years ago. It raised the concerns set out in a World Bank report, which called on Cotonou to be radically simplifiedan important point, given that EU commissioners will have more bag carriers at trade summits than African, Caribbean and Pacific countries will have lawyers. Non-governmental organisations, including ActionAid, Oxfam, Christian Aid, CAFODthe Catholic Agency for Overseas Developmentand a number of others, have been circulating Members with a briefing entitled Six Reasons to Oppose Economic Partnership Agreements in their Current Form. I acknowledge that economic partnership agreements are part of the tedious language of trade negotiations, which is why it might be helpful if debates such as this could take place when the Secretary of State for Trade and Industry was in the Chamber to answer them; however, they are the new instruments that will be introduced to replace the existing arrangements with ACP nations.
	Earlier this month, officials from the Department for International Development and the Department of Trade and Industry gave evidence on Cotonou to the International Development Committee. After hearing that evidence, every member of the Committee believes that we have not sufficiently kept our eyes on the ball on Cotonou and on the impact that discussions will have on the least developed countries, in particular the ACP countries.
	One of the officials described the negotiations on Cotonou as
	a highly uneven playing field
	for developing countries to negotiate on. There is no idiot's guide to Cotonou, but these are the basics. In 2000, the Cotonou agreement replaced Lom, and it marked a shift from non-reciprocal tariff preferences to establishing reciprocal trade agreements for all ACP countries. The Cotonou agreement proposes to create World Trade Organisation-compatible economic partnership agreementsEPAsbetween the EU and the six ACP regions. The ACP group will continue to exist, but its role and scope will be radically altered. That will mean that quite wealthy countries, such as the Bahamas, will negotiate with quite poor countries, such as St. Kitts and Nevis, under the same arrangements.
	The EU has said that the economic partnership agreements should have a strong developmental emphasisalthough we have yet to see evidence of thatbut that they should also include reciprocity, so preference will go. In other words, as the markets of the EU open up, the EU expects the markets of the poorer countries to open up simultaneously. In evidence to the Select Committee, officials stated that economic partnership agreements will
	promote development through trade by maintaining ACP preferential access to the EU market.
	However, they also said that the regional trade agreements must include reciprocity. Ministers need to indicate how those two seemingly incompatible objectivesmaintaining preferential access and including reciprocitywill be put into effect in a WTO-compatible manner. If that does not happen, which side will the UK be on? Will it be on the side of those who want to help the least developed countries or of those who want to drive a mercantilist solution as speedily as possible?
	Officials also said that
	further analysis will need to be done to look at which sectors, and on what time scale, reciprocal market opening by the ACP would best meet their developmental needs.
	Who will conduct the analysis and, given that the economic partnership agreements are due to begin in 2008, when will it be carried out?
	It should also be remembered that countries such as St. Kitts and Nevis, which has only four trade negotiators, are simultaneously having to deal with the ACP negotiations on Cotonou and the Doha negotiations at the WTO, which will be going on until next year. In a recent speech to ACP Heads of State, Kofi Annan said:
	A major concern, for example, is the impact that the trade liberalisation to be wrought by EPAs would have on fiscal revenue. Many of your countries are heavily dependent on income from tariffs for government revenue. The prospect of falling government revenue, combined with falling commodity prices and huge external indebtedness, imposes a heavy burden on your countries and threatens to further hinder your ability to achieve the Millennium Development Goals.
	This is rather powerful stuff from the Secretary-General of the United Nations. He is effectively saying that our Prime Minister is setting up a Commission for Africa on the one hand, yet on the other what the European Union, through the Cotonou negotiations, is putting in place threatens, to quote the words of the Secretary-General, to hinder least developed countries'
	ability to achieve the Millennium Development Goals.
	There does not seem to me to be very much policy coherence. The UN Secretary-General is telling the ACP states that negotiations with Europe will make life a lot more difficult for them rather than a lot easier.
	We should consider dropping the principle of reciprocity in the EPA negotiations, because reciprocity between the EU and the ACP countries constitutes a substantial threat to the economies of those nations. Not least is the concern about the uneven playing field on which reciprocity is being negotiated. There has been little coverage of the subject in the UK press, but it has deeply concerned the press and people in the developing world.
	The Prime Minister is rightly focusing on Africa as the lead theme for Britain's G8 presidency, so it seems somewhat strange for us to be making life more difficult for Africa elsewhere. It is simply not acceptable to talk up the EU's commitment to a bilateral agreement at the World Trade Organisation while simultaneously shopping around for what might be more advantageous bilateral deals.
	The Government, when they are pressed on these economic partnership agreements, say, We understand that there are problems here, so perhaps we can come up with some alternatives. One suggestion that officials have come up with, which I think Ministers are toying with, is a suggestion for a generalised system of preferences, but as yet there has been very little discussion of the limits of such systems. It is probable that it will prove impossible to offer all developing countries Everything but Arms access, but what steps are the Government taking to ensure that a viable alternative with at least as good access is available to ACP states that do not wish to pursue an economic partnership agreement?
	When the Under-Secretary of State for International Development, the hon. Member for Harrow, West (Mr. Thomas), responded during the recent debate on the Caribbean, he said:
	When I was in Brussels this week, I received assurance that the EU does not by any means expect full reciprocity. We have received continual assurances from the EU that it sees EPA as tools for development . . . The current EPA negotiations are focused on regional integration. For that reason alonealthough there are othersI do not think that we should delay the start of negotiations. They need to continue in tandem with the Doha . . . negotiations.[Official Report, Westminster Hall, 2 December 2004; Vol. 428, c. 41WH.]
	Hearing that, hon. Members could be excused for gaining the impression that, apart from a few tweaks, all is well in trade policy, yet officials were very much darker just 10 days earlier. On 30 November, they told the International Development Committee:
	I think probably the most worrying area is the fiscal one: that if the ACP or indeed the WTO negotiations forced the ACP, particularly African countries, to reduce their tariffs, they would have a huge problem in terms of their revenue. The World Bank has come up with some figures and it looks extremely grave from their evidence where they have estimated that offering the EU duty free access would incur losses amounting to one per cent of GDP and seven to ten per cent of Government revenue for sub-Saharan Africa. Obviously, therefore, you need to pace this and you need assistance for substantial fiscal reform. That is not the only area, obviously.
	The official then went on to explain this other area of real concern. She said that
	the UK as you know is very keen to see conditionality attached to EDF in terms of good governance and properly targeted development, but we certainly would not want to see any conditionality attached to implementing trade reforms. Basically, the work needs to be done, we need a dialogue with the Commission, but obviously it would be helpful if the Committee and others can be saying, do not let us rob Peter to pay Paul.
	I entirely agree with that.
	The Government have said that next year Africa will be very important, and I am quite sure that we shall hear a lot from the Prime Minister, the Foreign Secretary and others at the beginning of the year about the importance of the G8, the importance of the Commission for Africa, and the importance of Britain's presidency of the European Union in the last six months of next year to take forward their agenda on Africa. However, I ask the Minister for Europe to relay to the Secretary of state for Trade and Industry and others in the Government that if they get the Cotonou negotiations wrong the Commission for Africa will produce no more than hollow words because all it will mean is that the EU will make life in terms of trade, which is, of course, crucial to every developing country, much more difficult than at present in those developing countries.
	I had hoped that we would have an opportunity to debate trade policy on its ownwe clearly will not but that is an important part of EU policy, where the Commission largely has competence and the Government need to ensure that the Commission is responding to what I believe is a very considerable consensus in this country that, next year, we should seek to make poverty history, but we will not make poverty history if we do not get the Cotonou trade negotiations right.

Graham Brady: The hon. Gentleman is talking about large sums of structural fund money benefiting Wales. Is he suggesting that, if the British Government were directly responsible for spending that British taxpayers' money and it was not channelled through the EU, it would not be spent in Wales?

Ian Liddell-Grainger: I thank the hon. Gentleman for his incredible patience in giving way.
	The hon. Gentleman will know that I look across the bay from Bridgwater to his constituency. It may interest him to know that the Welsh Development Agency and others have tried to steal businesses from Bridgwater, which is an industrial town, for Wales. He may say that there is nothing wrong with that and that it is merely competition, but my area does not have any European funding at all, while his does. Does he think that that is right?

William Cash: Having listened to the expressions of the triumph of hope over experience that we have just heard, I should say that I do not wholly negate the views of those who desperately want the European Union to work. The problem is that many of its aspirations, noble as they were in 1945, have been, in fits and starts, gradually subjected to reality. We are now at the crossroadsnot exclusively, by any means, in terms of the constitution.
	The hon. Member for Ogmore (Huw Irranca-Davies) mentioned polls. A few weeks ago, ICM carried out a poll for the European Foundation, of which I happen to be chairman. It asked this question:
	Some people say that Britain should renegotiate the existing EU treaties so that they are reduced to trade and association agreements. Do you agree or disagree?
	The results were extremely interesting. They showed that 58 per cent. of the population at large agreed with that proposition. Significantly, as I told the right hon. and learned Member for North-East Fife (Sir Menzies Campbell), 65 per cent. of people in Scotland agreedas did 68 per cent. of 18 to 24-year-olds, which I found exceptionally interesting.
	At the heart of the questions that we have been discussing todayand which I have been trying to address since I entered the House in 1984, for which I make no apologyis the need for reality. We have now reached a point where we are fairly close to it, but it has been a hard slog. There is nothing anti-European about being pro-democracy.
	In his concluding remarks, the hon. Member for Ogmore spoke of the necessityalmost as a justification for the constitutionof combining the legal framework of the progression towards political integration with human rights. There is nothing in the existing treaties, as compared with the convention of Strasbourg, about human rights. Some would argueI do notthat the existing treaties have worked well. I believe that they have not worked well not because of the absence of human rights but for other reasons, which I shall consider shortly.
	I would dispute strongly the idea of human rights being the ultimate justification for the constitution of a community of values. After all, this country produced Magna Carta and the Bill of Rights. In many respects, the American constitution was based on the principles that we had enunciated. Jefferson, at the age of 33, had considerable regard in drafting the constitution, which he did himself in only a few months, to the traditions of the British constitutional arrangements. He took the viewI believe, justifiablythat they had gone off key because we relied too much on a constitutional arrangement that was insufficiently democratic.
	The most important human value, right or attributethe word that I preferis democracy. It is the means whereby, through elections, the voters decide how they are to be governed. It enables us to have freedom of speech and debate in the House. The principles in which we believe are entirely based on democracy and its application to the ordinary daily lives of the people whom we have the honour to represent.
	My great quarrel with the European Union is over its continuous progress away from the principles of democracy. I have raised repeatedly with the Foreign Secretary the point, which he conceded to me on 9 September, that in the constitution, primacy lies not with the EU but with Acts of Parliament. If the constitution were passed and the House of Commons choseit is matter of political willto pass legislation that was inconsistent with any previous enactment, which could, and should, in my view, include repeal or amendment of the European Communities Act 1972, judges in the British courts would be obliged not to disapply any subsequent Act but to apply it to the constitution. In other words, as I put it in the European Scrutiny Committee the other day, UK voters rule OK.

William Cash: In a moment, I shall look at the ingredients of the EU's failure to work. After being elected chairman of the Conservative back-bench committee on European affairs with 62 per cent. of the vote in a secret ballotI do not know what the result would have been if it was not secretI was asked in 1990 or 1991, by Lord Hurd of Westwell, who was then Foreign Secretary, to write a paper for the Conservative manifesto committee on the workings of the European Union. It has since been published by Duckworth in Visions of Europe. I am sure that the book is no longer on sale, but the title of my contribution was The European Community: Reality and Making It Work. Despite the considerable attempts over the years to demonise my views, I have only ever believed that a framework of co-operation in EuropeI urge hon. Members to notice that I did not use the word co-ordination, which the hon. Member for Birmingham, Edgbaston (Ms Stuart) used in her speech, because I do not accept that it is part of the processbetween truly democratic nation states does not promote nationalism but democracy. Those states could co-operate within a framework that benefits everybody in trade, commerce, industry and, as happened in the war, defence alliances.

Richard Bacon: Does my hon. Friend agree that the hon. Member for Birmingham, Edgbaston (Ms Stuart) is wrong, because legitimacy does not derive from the Council of Ministers or the European Parliament? It derives from consent. If a body has consent it has legitimacy. It does not, no matter what is written, it does not have legitimacy.

William Cash: I am grateful to my hon. Friend for his contribution, with which I agree.
	The issue of the general election can be compared with that of the European Court of Justice, for example. If it makes an adjudication in relation to matters that we might want to change, whether under the constitution, or, as I shall explain, with respect to existing treaties, it is then set in concrete, and our judges are obliged to apply the law, as enunciated by the European Court of Justice as the ultimate jurisdiction. That is yet another inhibition, unless, of course, we can change it. My argument, profoundly, is that we can change it, but we must show that we have the political will.
	The arguments that I put forward are not exclusively concerned with the issue of the constitution, to which my party is opposed in principle, I am glad to say. I attempted to set out arguments when I was shadow Attorney-General to demonstrate the necessity of regarding that as a matter of fundamental change requiring a referendum, which I am glad that the Government have also accepted, because of the issue of primacy. It is of the highest political importance that we get this right, which is why I am glad to take part in such a lengthy debate.
	These matters must be set out as clearly as possible. They relate not just to the mechanics of institutional change, but ultimately and fundamentally, to the way in which we are governed, which I have been trying to argue for the past 15 to 20 years. That is not to say that we need to be entirely negative abut the advantages of co-operation, whether in Europe or in other alliances on the international stage. The issue is how it is prescribed and followed through in practice.
	With respect to the question of the United Kingdom and the arrangements for the constitution, before I deal with what the existing treaties contain, and why I regard that as a matter to be dealt with nowbefore the general election and not afterwardsI want to touch on whether the European constitution would survive a no vote in any one of the countries.
	It is completely clearI hope that the Minister will not disagreethat if any one member state fails to ratify the treaty, the draft constitution will not go into force. I think that that is accepted on both sides of the House. What follows from that, however, is that the existing treaties will continue to apply, because their repeal is dependent on those provisions that I put to the Prime Minister in Prime Minister's Questions some months agothat all the existing treaties will be revoked, and all the laws and regulations, European Court of Justice rulings and the acquis communautaire will be repealed but reapplied, which is the key point, under the new doctrine of primacy prescribed by article 1(5), or 1(6), of the proposed constitution. If that constitution fails, by definition, the existing treaties continue.
	What that boils down to is that all kinds of permutations are possible as to what may be decided on at that stage. Ireland and Denmark, for example, went for second bites of the cherry. That was disgracefulit was disgraceful that my Government allowed that to happen in the case of Denmark, and I said so at the time. There is a question as to what would emerge, apart from the idea that there would be a rerun of a referendum, which I regard as pretty unthinkable in terms of British democracy and constitutional arrangements. None the less, there would have to be a negotiation between member states that had agreed to go ahead and those that had not.
	That brings me to the problems that I see with regard to the existing treaties that would be left, as it were, on the statute book. Let me give an example. In an intervention, I mentioned the growth and stability pact. As we know, it has been in serious trouble. Some Members may recall that I felt so strongly that it would not work in practice that when my right hon. and learned Friend the Member for Rushcliffe (Mr. Clarke), as Chancellor of the Exchequer, sent a letter to all Members of Parliament saying why he thought it was a good idea, I felt it necessary to send a letter to Conservative Members saying why I thought not just that it was not a good idea, but that it would not work.
	As it turns out, those of us who thought that the growth and stability pact was an unworkable proposition have been proved right. Analysis from the university of Bonn states unequivocally that the main effect of the pact has been to encourage countries to cheat by misreporting their deficits. When I put that to the Foreign Secretary in an intervention he did not reply, but the reality is that countries are cheating, which has caused many of the difficulties between Germany and Italy, for example.
	According to Mr. Wolfgang Munchau in the Financial Times of 13 December, one important reason for the fact that
	the stability pact is flawed in principle and not just in practice
	is that
	the euro was built on mistrust: the Germans, in particular, mistrusted the Italians. Another more respectable reason was the desire to emulate the experience of the US during the 1990s.
	I happened to attend a bankers' conference in Frankfurt, and heard Chancellor Kohl express very similar views all of 10 years ago. The growth and stability pact goes to the heart of the way in which the European economy is supposed to work: that is the key point. It is not just any pact; it is a deal that was struck in an attempt to bring a degree of stability to the European economy. Why is the European economy not working under the existing treaties? Why do we have low growth and high unemployment? The short answer isalthough I am sure that the Minister for Europe does not want to hear all thisthat there is no reason other than the fact that the pact cannot work.
	The Minister for Europe is engaged in his own peculiar Houdini trick. He knows how unpopular is the European project that he has hammered so stridently for the last 10 years, and he knows that it is not working. He knows that it does not even appeal to his own constituents. So he is shifting his ground in a shifty manner, and putting out statements criticising even his own Government for the basis on which they arrived at the completely false conclusion that the euro was capable of working and ought to be applied in the United Kingdom. The bottom line is that it does not work.
	We have heard today about Wim Kok's report, which is only a few weeks old and which I raised with the Prime Minister the other day. It has been acknowledged by members of the GovernmentI must say in all fairnessthat it is not working. Some have attempted to put up a fairly good defence, but the fact is that Wim Kok's report makes clear that the European economy is not working. It is not working because of the intrinsic faults in the thinking behind the social agendathe hon. Member for Ogmore promoted that agenda as an advantagewhich is driving economies such as Germany's mad.
	Massive over-regulation is inhibiting the growth of the economies of individual member states. A recent edition of The Business pointed out that according to a European Commission report, even the Commission believes that over-regulation is costing European business 1 trillion a year. David Arculus, chairman of the Prime Minister's own Better Regulation Task Force, submitted a report to the Prime Minister saying that over-regulation is costing the British economy 100 billion a year. According to the British Chambers of Commerce, in the past few years certain directives, many of which come from the European Union, have cost the economy 30 billion.
	The fact is that it is possible to reform the system, but it is not being reformed. It is no good the Minister for Europe, the Foreign Secretary and the right hon. and learned Member for North-East Fife talking about the virtues of the system, or the hon. Member for Ogmore talking about common values. Why should we respect common values if they are creating social tensions, high unemployment and low growth? There is a direct correlation between the treaties' provisions and the proposals for economic governance. As even some in the Minister's own party and many of the unions know perfectly well, schools, hospitals and other elements of the domestic economy cannot get the public expenditure that they want because of the constraints imposed by the convergence criteria laid down under the Maastricht treaty.
	I remember saying during the Maastricht treaty debates that I never thought the day would come when I had to criticise my own Government for deliberately creating unemployment. There are Conservative Members who will not agree with that line of argument, and I am not suggesting that we should have a free-for-all on public expenditure. What I am saying is that we can decide on these issues for ourselves in this place. The problem that the Government and Labour Members face is that the inhibitions that are not only putting strain on the economy but causing strains within the Labour party are the consequence of applying artificial criteria that originate in Europe. Instead, we should be making these fundamental decisions for ourselves.
	I come to our relationship with the United States. The entire existing treaty framework, including the Maastricht, Amsterdam and Nice treaties, creates serious problems for our relationship with other countries. It is perfectly obvious that compared with the United States, European countries have politically diverse opinions on all aspects of international life, such as free trade, NATO and how to organise economies. It cannot be disputed, for example, that the French are far more protectionist and sceptical about NATO, and that they organise their economy in a more statist fashion.
	The French are also espousing the creation of a European superpower; indeed, President Chirac openly called for that just before his state visit. I pointed that out to the Prime Minister and asked him how he is going to manage to ride two horses at the same time, given that he wants not only an EU superpower but a relationship with the United States. These are absurd foreign policy differences not merely of opinion, but of principle. Intrinsic to this part of my thoughts is the need for a democratic principle to be placed above all others.
	In the United States there is a deeply rooted community of thinking about how democracies should workfor example, through the operation of congressional committees, the working of the economy and the operation of Congress. After all, the European Union, for reasons already given, falls short and has fallen short over the last 100 years. Let us cast our minds back and look at that situation. Let us also remember that it is the United Kingdom and the United States that fought for the liberty on which many of the principles that Europeans encourage us to espouse are based. It is not very good, if I may say so, for people to criticise the UK in respect of its attitudes towards Europe; we should have regard to the fact that people such as my own father were killed in the last war fighting for those very freedoms.

Andrew MacKinlay: I apologise to House for not being in my place for the early part of the debate, but I was involved in other parliamentary business. The subject matter for the debate is drawn widely, because it is European affairs and that does not exclusively mean the European Union. Nor is there a specific motion before us that demands action.
	A good friend of mine gave me some wise counsel earlier this afternoon, saying that Mr. Speaker expects hon. Members to refer to contributions made during the debate. I intend to do so, both in respect of a comment made by my hon. Friend the Member for Ogmore (Huw Irranca-Davies) and of the lengthy but interesting speech by the hon. Member for Stone (Mr. Cash).
	You will know, Mr. Deputy Speaker, from your long time in the Chair, that Whips on both sides occasionally visit the Tea Room to say, The House is about to collapse. Can you come and do 10 minutes? I always let rip at them, because I believe that that insults me and the House. However, whenas on this occasionI decide that I would like to make a contribution, it apparently does not go down too well with those colleagues who occupy certain areas of the Treasury Bench.

Andrew MacKinlay: Not my hon. Friend, who is an outstanding Minister for Europe and one of the longest serving of the many Ministers for Europe in the Government. I hope that my commendation does not put his job in jeopardy.
	Everyone acknowledges that the hon. Member for Stone feels strongly and passionately about Europe, but it was deeply depressing to listen to his speech because he seems to lack a vision of what Europe could become and he does not see what has already been achieved. In 1992, when I entered the House, the Gracious Speech referred to the possibility of enlarging the EU. In my maiden speech, I spoke of my hope that Poland, Hungary and the Czech Republic would be able to join both the European Community and NATO, so it was profoundly moving for me and, more important, for many others when on 1 May those countries entered the European Union. For them, in many ways, it was the culmination of world war twoa long journey from 1 September 1939 to 1 May 2004, when they finally achieved true independence in the EU. We should take great pride in that.
	When the history of our time is written, our Prime Minister will be given credit for two important things: his diligence and perseverance on Ireland and his vision for the European Union, with which I am proud to be associated, because it will be one of his lasting legacies. Opposition Members who constantly disparage the EU should pause to think. They should remember that we are not the only members of the EU; we are not alone in following the rules, regulations and the acquisso do 24 others. It is mutual; there is shared sovereignty.
	Above all else, the beauty of the EU is that it has become a vehicle for the minimisation and resolution of conflict. People aspire to reach and achieve the Copenhagen criteria, and adjust accordingly. That adjustment is often painful and difficult; for example, the Baltic states had to ignore the scars of 30 years of Soviet occupation and come to an accommodation with their Russian minorities. It is to their credit that they did so. Those are great achievements.
	It is worth looking at recent history. I have a passion for world war one. A student once asked whether it had affected my view of politics. I replied, No, not at all, but on reflection I decided that perhaps I was wrong, because standing at Tyne Cot cemetery on the Ypres salient or at Langemark, the German cemetery in Flanders, one cannot help but be profoundly moved. We realise how small a village western Europe was and how much pain and trauma it suffered for hundreds of years. The European Union has resolved many conflicts.
	The hon. Member for Stone is extremely proud of his late, gallant father and his contribution to the defence of democracy in world war two and I acknowledge that. However, as he went on to traduce the Republic of France, I remind him that in the early summer of 1940 Winston Churchill offered the French Government an indissoluble union. Things have moved on, but I mention that fact because Winston Churchill recognised that the future interests of the United Kingdom and the Republic of France were indivisible and that we had to move forward with common purpose. It is important to bear it in mind that a man of some vision recognised that, although France had a republican system and Britain a monarchist system, and there was a history of conflict, those two great countries, separated by a small channel, needed to work together.

William Cash: Very simply, I would recommend that the hon. Gentleman read the biography of Churchill by Roy Jenkins. About 10 pages are devoted to this one question, as a result of which Roy Jenkins himself concluded that Churchill's position had moved very substantially indeed by the time he became Prime Minister. He said, associated but not absorbed.

Andrew MacKinlay: There has been no absorption at all, and it is absurd to suggest, as the hon. Gentleman doeshe goes on and on and on, like a Duracell batterythat somehow there is this absorption. He cannot bring himself to give any accolade to the European Union for its achievements, and yet it clearly has been the source of great conflict resolution and it is the hope of Europe.
	Often sometimes we are asked by constituents, Why are you interested in Kosovo, Bosnia and Herzegovina and Croatia? These are faraway countries. It is our European backyard, and not only have we suffered conflicts in the past decade in that region but there is the potential in some areas for them to flare up again. I think that all Members share the view that we need to do everything we can to avoid future conflict in our backyardin the Balkans. Even if we cannot be persuadedI think most people areof the need to do it for humanitarian reasons, we need to do so out of naked self-interest, because when there is conflict in south-eastern Europe all of us will have the traditional problems of refugees, asylum seeking, the great burdens that exist and the heartache that we have to deal with in our surgeries and so on.
	We now need to get the European Union, with all its energies, offering the carrot to Serbia, to Montenegro and to the people of Kosovo that their future can be in the European Union, and the future of the European Union will of course mean that many of the causes of conflict will be at least diminished. The very fact that people can live in one community and work in anotherthe free mobility of labourin what was the former Yugoslavia is itself one of the great resolvers of conflict.
	I hope that the Government will redouble their efforts through all the international agencies and through the European Union to do what they can not just to persuade the states of the former Yugoslavia to comply with the international tribunal, which clearly is a precondition of EU entry negotiations, but to make it clear again and again that if there is compliance there is the prospect of being able to join other countries that have now acceded from the former Yugoslavia into this European family.
	I also want to say to the Minister, as we are talking about European affairs, that all those in the House will be shocked by the limitations on democratic campaigning in Ukraine. I think that there has been insufficient interest by the European Union, and to some extent by the British Foreign Office, in that region in recent years. The Minister looks a bit shocked, but I have raised the subject of Ukraine and Belarus in the Foreign Affairs Committee on a number of occasions. The response has been that these are faraway countries that we should not be primarily occupied with. If the Minister thinks that is wrong, I would love him to amplify on the point.
	The House is united in its concern about the lack of democracy in Ukraine, but we treat it differently from Belarus. I do not think that there has been a qualitative difference between the regime in Belarus and that which has existed hitherto in Ukraine, and I think that we need to have a fresh approach on Belarus. It has 10 million people. It is very close to Poland. It could be absorbed into the European Union, if only there was a change of regime. I think that the cold freeze in which the European Union has put Belarus is not the best tactic.

Andrew MacKinlay: I think that could very well be so, but I also think that sometimes we do not see the inconsistencies in our approach. The failure of democracy in Ukraine is not dissimilar from the situation in Belarus, but we have been much more tolerant of Ukraine and President Kuchma, which is wrong. Our tactics in relation to both those countries should be reassessed.
	My hon. Friend the Member for Ogmore (Huw Irranca-Davies) spoke about Turkey's accession, and I think that I am in a minority of one in the Chamber because I am very unhappy about the present course. I do not oppose Turkey or, indeed, any other country joining the EU. In fact, in the very long term, we should allow countries that are strictly not in Europe to join if they meet the criteria. Hawaii is clearly not part of the continent of America, and I cannot understand why places such as Kyrgyzstan should not aspire to join if they so wish in years to come.
	Turkey has two problems, which Her Majesty's Government choose to ignore. First, it is not yet a robust parliamentary democracy. There is a long way to go before it can demonstrate that it reaches anywhere near the Copenhagen criteria, but even if it does, we must have regard for scale. It is a country of approximately 80 million people, but Turkey does not know exactly how many people it has in its population. The nature of records and censuses is much more limited in that country. It also has common borders with Armenia, Syria, Iran and Iraq. That is a serious problem for us all because, even if Turkey met the Copenhagen criteria, its geography is extremely difficult in terms of commercial security and combating terrorism, given the need to police those vast expanses of border.
	Of course, such problems could be overcome in time, but that will not be easily achieved in the next decade. That will leave us vulnerable to all the problems of people smuggling, drug trafficking and threats from terrorism. When Estonia and Poland acceded to the EU, we rightly stipulated that they must have good, robust national boundariesthey are also our EU boundariesand I do not believe that that can be achieved in the foreseeable future in relation to Turkey's boundaries, given all the countries to which I have referred.

Graham Brady: Indeed. The hon. Member for Ogmore believes that the EU has made no difference to funding for his constituents.
	My right hon. Friend the Member for Wells (Mr. Heathcoat-Amory) pointed tellingly to the inaccuracies of the Foreign Office's own guide to the European Union. As he pointed out, there are some gross discrepancies between what is in the guide and what is plain to see in the treaty.
	The debate was opened in magnificent style by my right hon. and learned Friend the Member for Devizes (Mr. Ancram), the shadow Foreign Secretary, who rightly highlighted the apparent disappearance of the EU constitution and the Government's pathetic inability to introduce their own Bill on the EU constitution. We await the Bill, which we will happily deal with when it is available, and we are deeply frustrated, as no doubt is the hon. Member for Ogmore, that we do not have the opportunity to debate the matter, which the Government apparently believe is of great importance for the United Kingdom.
	The Foreign Secretary spoke about the Government's determination to keep the size of the budget limited to 1 per cent. of gross domestic product. He admitted that there may be some discussion of own resources at the weekend and said that there would be a veto on any proposed change to the rebate. That is welcome. He refused to accept that questions regarding a common foreign policy and the activities of the high representative of the EU should be answered by the Department in this country. I stress to the Minister that, if the Government are committed to a common foreign policy for the EU, they must at the very least recognise the right of hon. Members in this place to ask questions about their policy and to expect answers. The Foreign Secretary went on to speak about the progress that we expect to be made with regard to the opening of accession talks for Turkey.
	The right hon. and learned Member for North-East Fife (Sir Menzies Campbell) spoke of his extreme disappointment at the lack of legislation for the constitution. He approaches the matter from a different standpoint from mine, but I commend him for his honesty in making clear his party's open commitment to greater political and economic integration in Europe. We do not share that commitment and it is not popular with the public, but we are delighted that he is so open.
	We had hoped that Ministers would clarify the Government's policy on European affairs in advance of the events later in the week. Perhaps the Minister will still do so in his closing remarks. It is particularly important at a time when the Government's EU policy is being gradually deconstructed by the Minister for Europe and the Chancellor of the Exchequer. It is becoming increasingly difficult to know exactly where the Government are facing.
	In recent weeks, we have seen the report from the Royal Commission on Environmental Pollution, which showed the abject failure of the common fisheries policy. We have also had confirmation from the Minister for Europe that the only fish stock that seems to be increasing at the moment is the red herrings found swimming in the vicinity of No. 11 Downing street. We have already been treated by my right hon. and learned Friend the Member for Devizes to accounts of the Minister's desire to leave the common agricultural policy, his view that the euro is an economic irrelevance and his claim to have persuaded the Foreign Secretary of the case for a referendum. I cannot quote the exact words in the interview that appeared in the New Statesman on 13 December on page 37, but I am sure that many others will go to the Library to look them up.

Graham Brady: I am grateful to the Minister for the help that he has provided. However, I was referring not just to Members of Parliament but to other British citizens who have volunteered to help in Ukraine but who must meet the costs from their own pocket.

Denis MacShane: This is a serious problem. Of course, one can find lawyers in The Hague, Berlin, Paris and in every Inn in the Strand who will give an interpretation. I have read out to my satisfactionwhether the House is satisfied will be seenthat the treaty clearly separates the two, and says that one cannot do the other's job. We will have to have that discussion with the Dutch, and I am happy to write to my hon. Friend.
	The right hon. Member for Wells (Mr. Heathcoat-Amory) read out a speech, much of which we have heard before. It included an extraordinary attack on article II-73. It is worth reading into Hansard what that article says:
	The arts and scientific research shall be free of constraint. Academic freedom shall be respected.
	I am delighted that that is laid down as a fundamental European value and written into a solemn treaty. Only the Conservative party, with its blind anti-European hostility, could see in that anything other than something for which British academe, British scientists and the House of Commons have fought for a long time.

Denis MacShane: Many European countries are moving towards our levels, and we do not have the highest ones. My hon. Friend should think about whether his argument should apply to 24 other countries, whose different sectors might say that they are losing fiscal gain or other advantages because of British goods and services. I can well imagine that some state-subsidised airlines are not keen on competition from easyJet and Ryanair, and he should be careful before he goes down the road that begins to hintI am sure he did not mean itat the kind of protectionism that every socialist has fought against all their lives, and that the Conservative party now seems to be embracing.
	The hon. Member for Banbury (Tony Baldry) asked about the Cotonon agreement, which deals with trade between the EU and the Asian, Pacific and Caribbean countries. He read out an important speech, much of it addressed to colleagues of mine in other Departments. I will ask them to write to him, although I mean no discourtesy: we in the Labour party entirely agree with his substantive point about the need for more debate in Europe.
	My hon. Friend the Member for Ogmore (Huw Irranca-Davies) listed many of the advantages that we gain from being in the EU. I hope that he circulates them all to his constituents and every other British citizen. They will then realise that there is only one future at the election: voting for the party that supports those advantages, and against the party that wants to stop Britain from enjoying them.
	The hon. Member for Stone (Mr. Cash) made a lengthy speech, in which he made his usual points but also revealed the new thinking of the Conservative party. He rightly said that he was against not just this treaty but the one before itand the one before that, and the one before that. He unashamedly used the word withdrawal in announcing that that was where the Conservative party wants Britain to go. What he said in 1992 had become the thinking of many members of the Cabinet by 1997; what he said in 1997 became Tory policy in 2001; what he says today is Tory policy for the future. We need to tell every business man in Britain that that is the Conservative party line: that the Conservatives want to pull us out of our biggest trading bloc.
	As for the important question of errors in the European Commission budget, it is a budget of about 100 billion. As one of my colleagues said, about 1.5 billion of that is contested. Both the Public Accounts Committee and the National Audit Office have drawn attention to lost moneys, accounts that cannot be signed off in Ministries and municipalities, and indeed direct fraud. I do not think that that calls into question the way in which Britain tries to deal with the problems. I fully accept, as do we all, that the EUlike most of its member statescurrently operates a cash-based accounting system rather than the accrual system required in the UK public sector. Our public sector has only recently adopted an accrual system, and we are fighting hard to get the EU to do the same.
	About 85 to 90 per cent. of the EU budget goes back to member states. The complaint is really with Ministries here. Anyone who looks at the accounts in detail will see that some of the payments not just of the countries mentioned, but of Ministries here, cannot be accounted for properly: I fully accept that. In fact, the Commission employs fewer people than the BBCeven the slimmed-down BBCand its budget is about a quarter of the size of the Pentagon's. That is a relatively small amount of money, those are relatively few people, and we have 25 countries co-operating as never before.
	The alternative, of which we have heard from the Conservatives, is the old Europe of conflict, division, confrontation and not seeking to speak with one voice. Every Member knows that in the new treaty we have preserved control over tax, vetoes on foreign policy and defence, and our permanent seat on the Security Council. In the European constitution we have given new powers to Parliament and Government. That is why the French are calling it la constitution anglo-saxon.

Huw Edwards: It is an honour to have the opportunity to address the House on the issue of tenant farmers. Apart from not having the security of the capital value of their land and buildings, tenant farmers are also disadvantaged in a number of ways. I shall deal with some of them, particularly with single farm payments, milk quotas, diversification and tenant farmers' personal housing needs.
	For those wishing to enter farming, having a tenancy may be the only method available, so the role of the tenant sector is important to assist new entrants to the industry. I acknowledge that the issues affecting tenant farmers have been considered by the Tenancy Reform Industry Group, under the chairmanship of Julian Sayers, and I also want to acknowledge the Government's response, which was published last year.
	My recent interest in the subject was prompted by two tenant farmers who attended my constituency advice surgery in Abergavenny. They are dairy producers with a herd of 95 Holstein-Friesians and they also keep sheep. They are Cathy and Nick Sprackling and they run the Ty Mawr farm in Dingestow, near Monmouth. Their concern was with the particular rules governing single farm payments and I will raise the matter briefly here in the House. Because single farm payment is based on three reference years, they were unable, for one reason or another, to submit a claim for sheep annual premium in 2000. As a result, they not only failed to receive that premium, but were further disadvantaged. They wrote to me about their problems and I submitted their letter to the Minister's office today. That was the issue that they came to see me about, and as I discussed with them particular issues affecting tenant farmers I thought of raising these concerns on the Floor of the House.
	They did not have any specific concerns with their own tenancy arrangements and had a high regard for the landlord, Mr. Bosanquet, who I also know well, but they raised important issues that it is right to put to the House. We discussed the price of raw milk, the cost of buying milk quota and especially their concern about future housing. I became intrigued to hear about the problems they faced with regard to housing. Because they are tenants, they will inevitably lose the property that they live in when they decide to retire. In order to find housing, they have currently taken out a mortgage to buy a property in the town of Monmouth, knowing that they will have to let it out until the time at which they retire. They are able to secure only a buy-to-let mortgage, which means that they are being further penalised. They are not going into rented propertya second homein order to make profit. It is all about security for the future.
	I understand that, traditionally, tenant farmers often sold their stock to secure sufficient funds to buy a property, often in the countryside if that was their choice, but that possibility is now largely ruled out because of both the relatively low value of stock and the relatively high price of country properties.I was particularly concerned to hear about the way in which they were being disadvantaged in the housing market and I wondered whether mechanisms could be introduced to help people who have difficulty getting affordable housing. Right hon. and hon. Members who represent rural constituencies know of the great difficulties in being able to live in such areas. My constituency of Monmouthshire is an area of very high property prices.
	One initiative that I know about in Monmouth is called the shared equity scheme, which is being introduced by a private developer, Lovell, in conjunction with the housing association. Effectively, people buy half the house and the other half is kept by the housing association. It makes housing far more affordable. I wondered whether such schemes could be made available to people in rural areas and I was very pleased to hear that a charity called ARC Addington has such a scheme. Its strategic rural housing scheme allows applicants to choose a property and location. That property is then rented back to them, or made available for purchase under a shared equity arrangement.
	My constituents, Mr. and Mrs. Sprackling, were penalised by having to secure a buy-to-let mortgage, and they tell me that the taxman will penalise them again by treating the rent from their property as unearned income. They believe that it would be fairer to treat that property as their main residence, and to regard any rental income as earned income.
	There are not a great many tenant farmers in my constituency, but they do exist. To its credit, Monmouthshire county council has about 50 tenanted farms. The scheme governing county council farms was established after the first world war. It allowed local authorities to rent land to farmers as a way of helping men coming back from the war. It was a farms fit for heroes scheme, to go alongside the homes fit for heroes scheme introduced at that time.
	In many rural areas, pockets of council houses were built after the Housing Act 1919 made it possible for rural and agricultural workers, and others on low incomes, to live in the countryside. That opportunity has largely been lost as a result of right to buy, as many of the properties involved have gone into the private sector.
	One important function of the tenant sector is to allow new entrants to come into the farming industry. However, the Tenant Farmers Association has highlighted the challenges facing new entrants to farming, and called for policies that help rather than hinder their progress. The TFA has always championed the cause of new entrants. Tenancies are the principle mechanisms by which new tenants access the industry, and the TFA is keen to ensure that a strong supply of tenancies remains available to new entrants. Local authorities may be able to continue the traditional role of having tenant farms, but the indications are that they are more likely to divest themselves of their estates than to invest in buying land for tenant farmers.
	One way to encourage more entrants into the industry would be to increase the opportunity for people to retire from it. There has been much talk about that in recent years. I well remember the crisis of the late 1990s, when I attended packed meetings with the former MP for Brecon and Radnorshire, now Lord Livesey. Many farmers wished that they had the opportunity to get out of the industry. Early retirement schemes have been available in many other professions and public-sector occupations, and it would not be unreasonable for a similar scheme to apply to the farming sector.
	As a result of the inquiries that I have made and the parliamentary questions that I have submitted to the Government, I understand that progress on this matter has been very slow. The TFA has urged the Government to implement a commitment in the new manifesto to develop a scheme allowing people to retire from the industry so that they can make way for others.
	The Welsh Assembly has also discussed this matter. It was said that implementing an early retirement scheme was inhibited either by the constraints imposed by the EU, or by the Assembly's limited powers, but I hope that the Government will continue to consider the possibility.
	Diversification is another issue that affects tenant farmers. The TFA has highlighted the problem that some tenants face when considering diversification. Business advisers often suggest that farmers consider diversification as an option for business development, but it is not always appreciated that tenant farmers may not be able to take advantage of diversification because of the restrictions that apply under tenancy legislation, and in their tenancy contracts.
	The chief executive of the TFA, George Dunn, has said:
	Most agricultural tenants will require the consent of their landlords before embarking on a non-agricultural project on let land. If such a project would add to the profitability of a tenant's business and help to sustain the level of rent, it would seem clear that the landlord should support it. However, some landlords insist on the observance of 'agricultural only' clauses which appear in tenancy agreements and take a negative attitude to tenants' plans to diversify.
	A survey by the TFA discovered that on traditional lettings under the Agricultural Holdings Act 1986, tenants reported that 53 per cent. of landlords had taken or would take a negative attitude to the carrying out of non-agricultural activities on let land. However, other research commissioned by the Country Land and Business Association suggests that landlords are more favourably disposed to support tenants wishing to diversify96 per cent. of all landlords surveyed by the CLBA would grant consent if asked by their tenant, subject only to reasonable terms to protect the landlord's interest and the value of the land. Examples of diversification include cafes, boat moorings, caravan sites, and Christmas tree growing. Those and other forms of diversification have been encouraged. In fact, they have been a necessity in agriculture in recent years.
	Concern has increased over reports that some landlords, including traditional landlords, are taking the opportunity, where available, to bring existing farm tenancies to an end as a lever to extract concessions from tenants on any single farm payment entitlement that might be established. Where that happens, it appears to be very unreasonable. I have not personally come across any cases in my constituency, but I know that it has been a concern of those who represent tenant farmers. In order to avoid that serious problem occurring, the TFA is putting pressure on the Government to introduce a statutory code for the tenant to be able to enforce a valuation of the entitlement at the end of the tenancy if he does not want to take it away with him. That would then be passed to the landlord for allocation to an incoming tenant in return for the compensation settled. That method would be similar to the provisions contained in legislation that provides compensation to tenants for milk quota or other end-of-tenancy claims on improvements.
	Speaking to my constituents, Mr. and Mrs. Sprackling, I was concerned to hear about the problems they have with the price of raw milk. They currently receive 17.2p per litre for raw milk, which is a slight increase on the average price for last year. However, they and other tenant farmers in similar situations cannot make a profit at that price. While we all acknowledge that consumers get a good deal when they go to a supermarket and buy six pints of milk for 1.24 or a little more, the worry is how little the farmers get. Several dairy farmers in my constituency have given up in recent years because of the problems faced by the dairy sector.
	Together with other hon. Members, I have supported the call for a new strengthened supermarket code of practice. The current code of practice was introduced following the report by the Welsh Affairs Committee on the livestock industry. After publication, we made representations to the Office of Fair Trading that a code of practice be introduced. It was introduced, but on a voluntary basis. There is a strong argument for strengthening it and possibly placing it on a statutory basis.
	I am sure that all hon. Members would acknowledge that the tenant farming sector plays an important role, especially for those coming into the industry. The Government have been active in working with all parts of the industry to ensure that the concerns of tenant farmers are addressed and that they are not disadvantaged. We must all support tenant farming and help it flourish, as well as recognising that some of the disadvantages faced by tenant farmers must be addressed.

Alun Michael: I am grateful, Madam Deputy Speaker. We learn something every day.
	I was pointing out the importance of the tenant farmer sector, before I turned to the specific points that my hon. Friend the Member for Monmouth raised on behalf of his constituents. If, as we want to do through the strategy for food and sustainable farming, we are committed to ensuring a viable and prosperous future for the tenanted sector it is important that we ensure that tenant farmers are able to adapt to the changing circumstances in agriculture and take advantage of emerging possibilities.
	Farmers today can no longer rely on food production, or food production supported by subsidy-related production, as the sole means of earning their income. Diversification from traditional agricultural activities is often essential to ensure the sustainability and prosperity of a farm business. Greater awareness of the need to protect the environment has led to changes in the way in which land is farmed and managed.
	Tenant farmers have often been hampered in adapting to those changes due to the legislative framework and the structure of agricultural tenancies, which relates directly to one of my hon. Friend's points. That is why, at the end of 2002, Lord Whitty and I asked the Tenancy Reform Industry Group to look at the way forward for tenancy reform. I am pleased that my hon. Friend noted the work of the group, led by Julian Sayers. The TFA made a constructive contribution to that work.
	The main features of the group's recommendations were proposals for changes to the Agricultural Holdings Act 1986 and the Agricultural Tenancies Act 1995. At the end of September, the Government issued a consultation document on a regulatory reform order on tenancy reform, which, if adopted, will implement all the proposals for legislative change made by the Tenancy Reform Industry Group. The proposed amendments to the legislation will create a more flexible framework for agricultural lettings and enable tenant farmers to take greater advantage of the opportunities presented by diversification and agri-environment activities.
	Specifically, the amendments would allow tenant farmers to include income from diversified activities, carried out with the consent of the landlord, in the eligibility criteria for succession to a tenancy. They would allow the simplification of procedures relating to succession to a tenancy on retirement. They would provide for greater flexibility for landlords and tenants to reach agreement on rent reviews and end-of-tenancy compensation. They would also make it easier for landlords and tenants to agree to restructure a holding without jeopardising the status of the tenancy. Each of these points is important not only for the future of the tenanted sector but for the capacity of individuals to move on from a tenancy. My hon. Friend is right to say that that is sometimes a challenge and a problem.
	The consultation period on the regulatory reform order ends this month and I hope that the amended legislation will come into force at the end of 2005. In addition to working on changes to legislation, the Government have worked with the Tenancy Reform Industry Group to produce a code of good practice for agri-environment schemes and diversification projects within agricultural tenancies. The code will assist landlords and tenants in reaching agreement on diversification and agri-environment projects. We have agreed to back up the code by providing funding for an adjudication scheme to consider cases where landlords and tenants have been unable to reach agreement.
	The fresh start initiative that Lord Whitty launched at the Smithfield show earlier this month will benefit all farmers. Many of its measures will be particularly relevant to tenant farmers, and draw on the structural recommendations proposed by the tenancy reform industry group. In particular, fresh start addresses the problems of farmers considering retirement. Representatives of tenant farmers have lobbied strongly for an early retirement scheme under the England rural development programme, which my hon. Friend mentioned. The Government are not convinced that this would be good value for money, and money would have to be diverted from other grant schemes that are providing valuable public benefits, such as the agri-environment schemes.
	We are aware that there is a particular problem for tenant farmers in finding suitable accommodation for their retirement. Tenant farmers want to be able to retire in rural areasin other words, to be able to live where they have lived and worked all their life. I think that that has been dealt with in general by ensuring that more affordable homes are built in rural areas.
	In referring to that and referring specifically to his constituents' experience, my hon. Friend referred to the work of ARC Addington, which has offered interesting and constructive ideas on shared equity. A few months ago, its director made a presentation to the rural affairs forum for England, which I chaired and which was also attended by my right hon. Friend the Minister for Housing and Planning, and I understand that there are proposals with the Office of the Deputy Prime Minister on that type of model.
	Shared equity is one of the ways of ensuring that affordable housing is not only provided but remains and can be recycled for future generations, whether that be 30 years onthe next generationor, as sometimes happens with affordable housing, on a 10-year cycle, so the benefits of that model could be considerable. My understanding is that some elements of the proposal could be accommodated within existing arrangements but others would require changes.
	Affordable housing in rural areas is the issue that leads to the problems; if there was sufficient affordable houses it would not be as difficult for people to find accommodation. I met the director of the Housing Corporation recently, and received very strong assurances that it will do what it has done over the past few years, which is to exceed the targets set out in the rural White Paper for the provision of social housing in rural areas. I know that colleagues at the Office of the Deputy Prime Minister have proposed a number of measures, particularly in relation to planning, that will assist in the provision of specific opportunities at the local level. We are often talking about the very smallest of communitiesthose under 3,000and we are also talking about arrangements where the exceptions policy has been very constructive in recent years; that policy will continue.